Frankly, I’m not interested in hearing from people who suggest that the Democratic Party doesn’t pay enough attention to the pocketbook issues faced by most Americans. Regardless of the fact that they have adopted different strategies, you would be hard-pressed to find a Democrat who wasn’t in favor of:
- Providing more affordable access to health care,
- Raising the minimum wage,
- Expanding living wage jobs via investments in infrastructure and sustainable energy,
- Making college more affordable,
- Expanding access to child care and pre-K, and
- Protecting and strengthening Social Security.
The other thing Democrats agree about is that, in order to address those issues, we need a progressive tax system in which the wealthy pay their fair share.
By way of contrast, Republicans—including Donald Trump—are opposed to all of the above. For decades now, the GOP has been lying to middle class American by pretending to be their champion, while attempting to paint Democrats as the party of the elite. That is a lie and anyone on the left who promotes it should be called out.
To demonstrate the gulf that exists between the two parties on these issues, conservative economist Peter Morici appeared on Fox and Friends Monday morning to discuss Elizabeth Warren’s wealth tax. As a reminder, here is how Matthew Yglesias describes her plan.
The basic plan is to levy a 2 percent tax on fortunes worth more than $50 million, and a 3 percent tax on fortunes worth more than $1 billion. According to the post, Saez estimates this tax would hit approximately 75,000 families and raise $2.75 trillion over a 10-year period.
Here is the discussion between Steve Doocy and Morici.
Fox guest Peter Morici on Elizabeth Warren's wealth tax: "$50 million is big, but it's not as big as you think." pic.twitter.com/TZx8z2a6sl
— Bobby Lewis (@revrrlewis) October 21, 2019
It is important to note that under Warren’s proposal, the 2 percent wealth tax doesn’t kick in until after $50 million. But Morici says that $50 million is “not as big as you think it is.”
I would suggest that just the opposite is true. Most of us have a hard time grasping how big it is. Someone on twitter helped us with that by providing this example: “Imagine being given $5k per day every day for more than …27 YEARS!” Another twitter user pointed out that if the $50 million were invested with a return rate of 4 percent, it would provide “$2 million in income per year without ever touching the principle, while allowing it to keep getting bigger.”
Getting back to the description from Yglesias, there are 75,000 Americans whose wealth is actually higher than $50 million. We now know that, thanks to Republican policies, the wealthiest among that group pay a lower tax rate than the rest of us.
For the first time on record, the 400 wealthiest Americans last year paid a lower total tax rate — spanning federal, state and local taxes — than any other income group, according to newly released data.
That’s a sharp change from the 1950s and 1960s, when the wealthy paid vastly higher tax rates than the middle class or poor.
Since then, taxes that hit the wealthiest the hardest — like the estate tax and corporate tax — have plummeted, while tax avoidance has become more common.
President Trump’s 2017 tax cut, which was largely a handout to the rich, plays a role, too. It helped push the tax rate on the 400 wealthiest households below the rates for almost everyone else.
Republicans are the ones who have been pushing to repeal the estate tax, which they re-named the “death tax.” They are also the ones who made a reduction of the corporate tax rate a centerfold of their most recent tax cut.
When it comes to the cumulative effect of Republican policies, we’ve seen this play before. The next act will feature warnings about the ballooning federal deficit, with demands that services be cut for every group of Americans except the military. Meanwhile, they will insist that we can’t contemplate raising taxes on the people who are worth more than $50 million dollars, because that’s not as much as we think.
Elizabeth Warren’s wealth tax is just one Democratic proposal that would make our tax system more progressive, while providing funds for the kinds of programs and services that help working Americans. Talking about it has already brought at least one conservative out from behind the curtain to defend the uber wealthy. More of that, please.