Following up on my previous posts:
New York Times op-ed: Elizabeth Warren Does Teddy Roosevelt, by Paul Krugman:
America invented progressive taxation. And there was a time when leading American politicians were proud to proclaim their willingness to tax the wealthy, not just to raise revenue, but to limit excessive concentration of economic power.
“It is important,” said Theodore Roosevelt in 1906, “to grapple with the problems connected with the amassing of enormous fortunes” — some of them, he declared, “swollen beyond all healthy limits.”
Today we are once again living in an era of extraordinary wealth concentrated in the hands of a few people, with the net worth of the wealthiest 0.1 percent of Americans almost equal to that of the bottom 90 percent combined. And this concentration of wealth is growing; as Thomas Piketty famously argued in his book “Capital in the 21st Century,” we seem to be heading toward a society dominated by vast, often inherited fortunes.
So can today’s politicians rise to the challenge? Well, Elizabeth Warren has released an impressive proposal for taxing extreme wealth. And whether or not she herself becomes the Democratic nominee for president, it says good things about her party that something this smart and daring is even part of the discussion.
The Warren proposal would impose a 2 percent annual tax on an individual household’s net worth in excess of $50 million, and an additional 1 percent on wealth in excess of $1 billion. The proposal was released along with an analysis by Emmanuel Saez and Gabriel Zucman of Berkeley, two of the world’s leading experts on inequality.
Saez and Zucman found that this tax would affect only a small number of very wealthy people — around 75,000 households. But because these households are so wealthy, it would raise a lot of revenue, around $2.75 trillion over the next decade.
Make no mistake: This is a pretty radical plan.
I asked Saez how much it would raise the share of income (as opposed to wealth) that the economic elite pays in taxes. His estimate was that it would raise the average tax rate on the top 0.1 percent to 48 percent from 36 percent, and bring the average tax on the top 0.01 percent up to 57 percent. Those are high numbers, although they’re roughly comparable to average tax rates in the 1950s. ...
I’ve been struck by the reactions of tax experts like Lily Batchelder and David Kamin; while they don’t necessarily endorse the Warren plan, they clearly see it as serious and worthy of consideration.
- Press Release, Senator Warren Unveils Proposal to Tax Wealth of Ultra-Rich Americans
- Emmanuel Saez (UC-Berkeley) & Gabriel Zucman (UC-Berkeley), Letter to Elizabeth Warren (Jan. 18, 2019)
- Bruce Ackerman (Yale), Anne Alstott (Yale), Phililip Bobbitt (Columbia), Jon Michaels (UCLA), Aziz Huq (Chicago), Bernice Greenberg (Chicago) & Robert Tsai (American), Letter to Elizabeth Warren (Jan. 24, 2019)
(Hat Tip: Mike Simkovic) Additional press coverage:
- Bloomberg Tax, Warren’s Ultra-Millionaire Tax Revives Centuries-Old Legal Fight
- Boston Herald editorial, Elizabeth Warren’s Tawdry Tax Threat
- Sam Brunson (Loyola-Chicago), Elizabeth Warren and the Wealth Tax
- Daily Signal, Elizabeth Warren’s Wealth Tax Is Another Radically Bad Idea From the Far Left
- David Kamin (NYU), Twitter Thread
- Los Angeles Times, Elizabeth Warren’s Wealth Tax Is Constitutional, Experts Say — and Necessary
- Mother Jones, Here’s How to Enact a Wealth Tax That the Supreme Court Won’t Kill
- Politico, Howard Schultz Rips Warren's 'Ridiculous' Plan to Tax the Super Wealthy
- TaxVox, Inside The Warren Vs. Harris Battle Over Tax Progressivity
- Town Hall, 70 Percent Income Tax, 3 Percent Wealth Tax
- Washington Post, Warren’s Push for a Wealth Tax Could Be a Game Changer
- Washington Post editorial, Elizabeth Warren Wants a 'Wealth Tax.' It Might Backfire.
- The Week, How Elizabeth Warren's Wealth Tax Could Save America