Democratic presidential candidate Elizabeth Warren sees her wealth tax proposal as a means to unite a polarized country, but some of her competitors aren’t buying it.
“We want to build an America that works for the people, not one that just works for rich folks,” the Massachusetts senator said before pitching her wealth tax proposal at the Democratic National Committee’s November 20 debate in Atlanta.
“A 2-cent wealth tax, and we can invest in an entire generation’s future,” Warren said of her proposal, which calls for a 2 percent annual tax on the accumulated wealth of taxpayers above a $50 million threshold. That level would climb to 6 percent for billionaires under Warren’s most recent iteration of the proposal.
But fellow candidate Sen. Cory A. Booker of New Jersey pushed back on Warren’s “cumbersome” proposal, citing practical concerns regarding valuation and the experience of other countries that have tried — and largely failed — to implement an effective wealth tax. Instead, Booker said, it would be better to raise revenue from other sources, like a higher and more robust estate tax, and by taxing capital gains as ordinary income.
“Real strategies will increase revenue,” Booker said.
Warren insisted that her wealth tax isn’t intended to punish the ultrawealthy. Rather, it’s a response to the fact that “our government is working better and better for the billionaires, for the rich, for the well connected, and worse and worse for everyone else,” she said.
Warren laid out her vision for a wealth tax that would fund several major new initiatives, including universal pre-K, student loan debt forgiveness, and vastly increased public school funding.
Competing Tax Proposals
Sen. Amy Klobuchar of Minnesota also indirectly took a shot at Warren’s ambitious policy agenda, emphasizing that it was important to demonstrate how new initiatives would be paid for. Democrats need to think big but also be fiscally responsible, she said.
Klobuchar referred viewers to her campaign website, which calls for repealing the regressive portions of the Tax Cuts and Jobs Act, enacting the “Buffett rule” 30 percent tax on individuals annually earning over a million dollars, ending the special tax treatment of carried interest, and — like Booker suggested — treating capital gains as ordinary income.
“I am not going to go for things just because they sound good on a bumper sticker and then throw in a free car,” Klobuchar quipped.
Booker also took a moment to plug a refundable tax credit for renters whose rent amounts to more than one-third of their income. That provision is featured in the Housing, Opportunity, Mobility, and Equity Act of 2019 (S. 2684), which Booker sponsored.
Enacting that credit would reduce poverty and help empower renters, similar to the home mortgage interest deduction, according to Booker.
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