Politics: Economists explain Warren's and Sanders' plans to tax the rich - - PressFrom - US
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Politics Economists explain Warren's and Sanders' plans to tax the rich

17:15  17 october  2019
17:15  17 october  2019 Source:   reuters.com

Bernie Sanders draws contrast with 'capitalist' Elizabeth Warren

  Bernie Sanders draws contrast with 'capitalist' Elizabeth Warren The Vermont senator has lost ground in the 2020 Democratic primary polls recently to his Massachusetts colleague"There are differences between Elizabeth and myself," Sanders, I-Vt., said in an interview with ABC News Chief White House Correspondent Jonathan Karl that will air Sunday morning. "Elizabeth, I think, as you know, has said that she is a capitalist through her bones. I'm not.

Warren ' s , which her camp shared with The Washington Post last week, takes the Sanders , not to be outdone, provided to the Post on Thursday the details of his preferred mechanism of By the time the ultra- rich die, however—kind of an integral aspect of levying an estate tax — the number balloons to a

The Economist explains . But Ms Warren ’ s levy would be crude, distorting and hard to enforce. A business owner making nominal annual returns of around 5% would see Although there is scope to raise taxes on the rich , they cannot pay for everything, if only because the rich are relatively scarce.

From 1982 to 2018 the share of U.S. wealth held by the 400 richest Americans is estimated to have grown from 1% to around 3.5%, or probably around $3 trillion.

According to Emmanuel Saez and Gabriel Zucman, the University of California at Berkeley economists who developed that estimate, that's in part because the wealthiest American families declare only a small portion of their actual economic gains in any given year as income, while leaving the rest invested in stocks and other assets, to grow in value.

Saez, 48, has been involved in a series of what are considered groundbreaking studies of U.S. income, inequality and economic mobility that involved both developing techniques to impute income based on holdings of wealth, and extensive access to U.S. Internal Revenue records.

Sanders tries to one-up Warren on fighting 'corporate greed' ahead of Tuesday debate

  Sanders tries to one-up Warren on fighting 'corporate greed' ahead of Tuesday debate As Democratic presidential hopefuls prepare for another debate Tuesday night, Sen. Bernie Sanders, I-Vt., released a plan on "corporate accountability and democracy" that attempts to go further than proposals from fellow progressive Sen. Elizabeth Warren, D-Mass., released earlier this year.In part of a plan to rein in "corporate greed" released by his campaign Monday, Sanders would create a new agency within the Department of Commerce called the "Bureau of Corporate Governance." It would also issue charters to large companies requiring them to base their actions on more than just the interest of shareholders.

Under Warren ’ s wealth tax plan , households would pay an annual 2% tax on all assets — net worth As Warren ’ s campaign website explains , “All household assets held anywhere in the world will be I just want the ultra- rich to pay a wealth tax on the diamonds, the yachts, and the Rembrandts too.”

(The economists advising Warren estimate that only 75,000 families—less than 0.1 percent of Americans—would be affected.) By the time the ultra- rich die, however—kind of an integral aspect of levying an estate tax — the number balloons to a cool .2 trillion.

He and Zucman, 32, have collaborated on several papers on the topic since 2014, and recently published “The Triumph of Injustice: How the Rich Dodge Taxes How to Make Them Pay.”

"The greatest injustice of the US tax system today is its regressivity at the very top: billionaires in the top 400 pay less (relative to their true economic incomes) than the middle class," the economists wrote in a September paper.

Their work might have been little more than a provocative read on the economics circuit, had the idea of a wealth tax not been picked up by the two progressive politicians now vying with former vice president Joe Biden for first place in the Democratic Party's nominating contest for the November 2020 presidential election.

O'Rourke accuses Warren of being 'punitive' in proposals

  O'Rourke accuses Warren of being 'punitive' in proposals Former Rep. Beto O'Rourke (D-Texas) sparred with Sen. Elizabeth Warren (D-Mass.) over her proposed "wealth tax" to pay for her sweeping policy proposals at the Democratic presidential debate in Ohio on Tuesday night. O'Rourke, one of several candidates to question Warren's and Sen. Bernie Sanders's (I-Vt.) more liberal proposals, which include "Medicare for All" and a tax on the wealthiest Americans, said Warren "sometimes ... is more focused on being punitive or pitting one part of the country against the other instead of lifting people up.

But Sanders , Warren , and Ocasio-Cortez’ s proposals are significantly more ambitious; Warren , for The Democratic proposals to tax the rich . Before we get into it, let’ s recap the basic plans — or Plenty of tax economists on the center and right tend to believe top rates are worse for growth than

WASHINGTON — Senator Elizabeth Warren of Massachusetts, a Democratic candidate for president, is expected to unveil a plan that would impose a new annual tax on the 75,000 wealthiest families in the United States.

Not only are Vermont senator Bernie Sanders and former Massachusetts senator Elizabeth Warren's wealth tax proposals remarkably similar, both proposals have been vetted by Saez & Zucman.

Taxing wealth, not income, became a hot-button topic during the Democratic debate in Ohio on Oct. 15, with several of the other 10 candidates on the stage rejecting it as too radical.

Entrepreneur Andrew Yang said that implementing such a tax would be impractical. Former U.S. Representative Beto O'Rourke called it "punitive." Amy Klobuchar, the Minnesota senator, said "when I look at this, I think about Donald Trump," suggesting that it would be so unpopular it could help the Republican president's re-election.

Warren and Sanders, however, have pitched it as a solution to the U.S.'s social and economic woes.

WARREN vs. SANDERS

The two politicians have slightly different proposals, but the aim is the same -to rebalance the distribution of wealth in the U.S. to fund the social programs like free college tuition that they're promising voters.

Biden, Warren get in tense debate exchange over accomplishments

  Biden, Warren get in tense debate exchange over accomplishments Sen. Elizabeth Warren (D-Mass.) clashed with former Vice President Joe Biden after Biden touted his capacity to "get things done" compared with Warren and Sen. Bernie Sanders (I-Vt.) in the Democratic debate Tuesday night in Westerville, Ohio."I'm the only one on this stage that has gotten anything really big done," Biden said, citing his history of passing legislation such as the Violence Against Women Act during his time in the Senate.Warren retorted that she had established the Consumer Financial Protection Bureau (CFPB), which she proposed in 2007.

Senator Bernie Sanders introduced a plan lowering the threshold for taxing assets transferred to heirs, joining others in the party With the bill, Mr. Sanders joins a growing chorus of left-wing politicians calling for new ways to tax the rich . Last week, Elizabeth Warren , the Massachusetts senator who

Sanders , Stein reports, supports both Warren and Ocasio-Cortez’s plans , adding that in 2017, Sanders “pitched a wealth tax on those with Sanders and Warren ’ s proposals face fierce opposition from Senate Republicans. Earlier this week, Senate Majority Leader Mitch McConnell of Kentucky, Sen.

Warren would apply a 2% tax on every dollar of net worth for households worth $50 million or more, and a 3% tax on every dollar of net worth beyond $1 billion.

According to tables in a recent paper by Saez and Zucman, this would apply to around $11 trillion of holdings this year, producing revenue of at least $220 billion.

Sanders' “extreme wealth tax” would tax households with a net worth above $32 million at 1%, meaning a household with $32.5 million would pay a tax of $5,000. That tax would rise in increments, to 2% on net worth from $50 million to $250 million all the way up to 8% on wealth above $10 billion.

Sanders' campaign estimated the plan, which would tax just the top 0.1% of U.S. households, would raise an estimated $4.35 trillion over the next decade.

MAKE THE RICH PAY MORE

Saez and Zucman say their research points to the wealth tax as an effective way to equalize the amount of tax paid by people with massive fortunes like investor Warren Buffett and Amazon founder Jeff Bezos with the middle-class, and then seed the proceeds through the economy.

Had the Warren proposal been in place since 1982, the share of wealth held by the top 400 would still have risen - but only to 2%. A higher tax rate of 10% on holdings above $1 billion, meanwhile, would have kept that group's share of national wealth stable.

In more individual terms, the 3% rate on holdings above a billion would mean Bezos would be worth just $86 billion this year, versus $160 billion. At the bottom of the top 15, casino mogul Sheldon Adelson would have $18 billion, versus $35 billion.

A dozen European nations used to have wealth taxes but most have done away with them. France, one of the last, abolished its wealth tax in late 2017, after thousands of millionaires relocated to neighboring, lower-tax countries.

Saez and Zucman argue that Europe's history with wealth taxes is not relevant to the United States because those countries set their wealth tax bar too low, and because it's easier to relocate within the continent for favorable tax laws.

The U.S. tax system, on the other hand, essentially taxes all citizens, no matter where they live.

Poll: Biden holds 2 point lead over Sanders nationally .
Former Vice President Joe Biden holds a slim 2 point lead over his closest competitor in the Democratic primary field, according to a poll released Tuesday.An Emerson Poll taken Oct 18-21 found Biden in the lead with the support of 27 percent of Democratic primary voters, while Sen. Bernie Sanders (I-Vt.) followed closely at 25 percent.Sen. Elizabeth Warren (D-Mass.), who previously led Sanders in the poll, slid two percentage points from Emerson's September poll and now sits in third place with 21 percent of voters saying they will support her primary bid.

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