The New York Times published an analysis of how Elizabeth Warren’s tax plan would affect the giant fortunes of the nation’s billionaires.
If you subscribe to the Times, you can see how each of the biggest billionaires is affected.
Although they would pay big taxes, they would still be billionaires. Bill Gates denounced Warren’s plan at a Times-sponsored event, claiming that Warren would tax away $100 billion from him, leaving him a virtual pauper. Not so.
“Yes, billionaires will have to pay a little more,” Senator Elizabeth Warren said of the revised tax package she introduced recently, “six cents on each dollar.”
This modest-sounding proposal, though, would have a far-reaching impact on the wealthiest Americans when combined with her other tax plans — shrinking colossal fortunes over time and making it much more difficult to hand down multibillion-dollar legacies.
The tax bite for any individual would not equal the $100 billion that Bill Gates jokingly cited, but over time it would still sting, according to estimates by two economists who advised Ms. Warren. If her wealth tax had been in effect since 1982, for example, Mr. Gates, who had made his first billion dollars by 1987, would have had $13.9 billion in 2018 instead of $97 billion.
Jeff Bezos, the world’s richest person, would have had $48.8 billion last year instead of $160 billion. And Michael Bloomberg, who is considering running for president himself, would have had $12.3 billion instead of $51.8 billion….
Diane Ravitch's blog 
“Ms. Warren, from Massachusetts, is not the only Democratic presidential candidate to promise to corral the galloping growth of riches controlled by those at the top. But she has steered away from demonizing it like Senator Bernie Sanders of Vermont, describing herself as a “capitalist to my bones.””
Oh for pity’s sake. Thanks for making your agenda clear, NYT. Bash Bernie. Anyone but Bernie!
BTW, the fact that Warren describes herself as “capitalist to my bones” is part of the problem. Capitalism is what’s killing us and more and more people are figuring that out.
No, capitalism is not what is killing us. Unregulated or too lightly regulated capitalism is. There is not a system out there that cannot be rigged to benefit one group over another.
What makes people believe that the potential subjects of this tax would just sit still and cough it up? Many (not all) wealthy people will just relocate their assets off shore, or put them into tax shelters.
Other nation’s experience has shown that taxes of this nature do not yield the anticipated revenue.
Wealthy people have influence in the federal congress, to stop any such taxes. And wealthy people have legions of CPAs and tax accountants who can advise on how to dodge and avoid any such taxes.
If the feds sincerely want more revenue, it is going to have to come from the middle class, who do not have the ability to evade taxation.
True, that. The billionaires can buy members of Congress to block any new taxes.
But that is no reason not to try.
You say “avoid” taxes, I say “evade”. The latter is a crime and should be treated as such. If you or I pretended to live in the Cayman Islands in order to “avoid” taxes, we’d be arrested for tax evasion. There’s no reason that corporations that pretend to be based in the Cayman Islands to “avoid” taxes shouldn’t be likewise prosecuted.
Exactly!
Do not get hung up on semantics. Tax avoidance is perfectly legal. I do not wish to pay cigarette taxes, so I do not smoke. The government is fine with me avoiding (evading) cigarette taxes by not smoking.
Corporations relocate offshore, to avoid taxes, perfectly legally.
That’s an absurd analogy. “Not smoking” is NOT tax avoidance.
Not buying cigarettes enables me to avoid paying cigarette taxes. That is not absurd, that is reality.
I used to live near the tri-point where Maryland, Delaware, and Pennsylvania meet. When I wanted to buy anything from a retail store, I would drive a couple of miles to Delaware, because Delaware did not have a sales tax.
When I wanted to buy liquor, I would buy it in Maryland, because their liquor taxes were lower than either Delaware or Pennsylvania.
The corporation I worked for, had their principal operations in Pennsylvania. But their corporate headquarters were a P.O. Box in Delaware, because Delaware had favorable corporate laws, and lower corporation taxes. (There is one corporation located in Delaware, for every seven people!)
Corporations and people often alter and modify their economic activity in order to take advantage of tax costs.
So if I buy a lower priced house, I am “avoiding taxes” on a higher priced house?
That’s ridiculous. People make decisions all the time that involve a calculation about taxes. “Not smoking” is not a tax-avoidance scheme.
I don’t smoke but it never occurred to me that I was not smoking to avoid paying the cigarette tax.
I agree that history does not give us many instances of good tax policy being the thing that lead to a more equitable society. Like the second empire French, who invented the Mansard roof to evade taxation, the wealthy seem at their best when they want to keep their money.
That said, it is equally futile to tax the middle class, for it has taken leave of us. How can there be a middle class when houses cost hundreds of thousands of dollars at a time when the people who build them are in penury?
I guess we are to stick to the gabele. That one caused the French Revolution. We are in debt up to what Reagan called our keester, and those who have benefitted from this arrangement are fairly obvious. If you have benefitted, it seems you should be grateful enough to help out. Maybe we should have a bake sale to buy flak jackets for our military guys?
I think this is as good as anything to start talking about fair taxation. We have to start somewhere.
Businesses could be denied access to the American market unless they meet conditional parameters- it’s just one law away. Billionaires could be tied by law to their corporations (limiting the protections of incorporation) and, then their choices would be to pay taxes, flee prosecution or go to jail.
Charles pretends its more difficult than it is.
And … it must be stated that if you wanted to spend one billion dollars in a calendar year, you would have to spend $532,000 per hour of every work day during the year. That’s $2+ million in the morning, $2+ million in the afternoon, rinse and repeat every workday throughout an entire year.
During one of Trump’s many bankruptcies, the banks to which he owed billions of dollars put him on a strict allowance: He was able to spend “only” $450,000 a month.
Could you get by on such a small sum?
That fact came out in several stories, including one in the last issue of the New Yorker, as told by the editor of his book “The Art of the Deal”
I’m sure that’s one of the big reasons why Bloomberg is running, to stop any attempt at raising taxes on the pathologically rich billionaires and multi-millionaires. Even with Bernie’s tax plans, the billionaires would still be rich but they would be paying their fair share. The billionaire class and the libertarian “think” tanks will be throwing everything they’ve got to destroy Sanders and Warren. It’s a real war and the rich are winning.
I don’t think Bloomberg is popular all, he has the charisma of an arrogant toad.
If by some horrible fluke (which is highly unlikely), the general election came down to Trump versus Bloomberg, I would vote for Mike because he is good on gun control, climate change and he’s not a serial liar like Trump.
For all its intuitive appeal to most Americans, I tend to think this plan faces such serious practical problems (including getting it enacted by Congress, implementing and enforcing it, and overcoming constitutional challenges) that it is largely an exercise in “Overton window” shifting.
Which itself would be well worth it, if in fact Warren actually makes serious attempt to shift the window if she gets nominated. History suggests this won’t be the case. Based on her history, Warren is likely to be Obama 2.0 who will conveniently forget all her progressive promises.
If you want Obama 2.0, it is Mayor Pete from McKinsey. He has more billionaire support than any other candidate.
Agreed completely on Mayor Pete. But I don’t see significant differences between him and Warren, other than Warren (like Obama) is now saying all the right things. Her history is not nearly as progressive as she is painted.
“Warren (like Obama) is now saying all the right things.”
Just to see if your claim had any basis in fact, I went to see if Obama really had offered a very progressive platform that had not been enacted. It turned out he did not. His platform seemed mildly progressive AT THE TIME because we had just experienced 8 years of Bush-Cheney, but it was quite moderate. HRC’s platform was far more progressive, but then she had a history of being far more progressive (which is why those of us who are old enough remember when the right wing was characterizing her as a socialist)
Furthermore, Obama did deliver on some of the more progressive promises which actually helped a lot of people. Not only were taxes raised on the wealthiest Americans, but unemployment benefits were extended for a year at a time when that was incredibly important. He did (eventually) raise taxes on the wealthiest Americans.
While Obama was thwarted tremendously by a far right wing Congress that was using the filibuster to prevent all legislation, he was – without a doubt – much better than having either McCain-Palin or Mitch McConnell. To say Obama “conveniently forgot” those promises is stunningly inaccurate. It would be much more accurate to say that right wing trolls and politicians hoped that the public would “conveniently forget” how obstructionist the right wing Republicans were and they hoped that the public would “conveniently forget” that Trump really was significantly worse than even a moderate Democrat.
And the policies that Elizabeth Warren is offering are hugely to the left of what Obama was campaigning on. There is absolutely no comparison. If Warren or Bernie are not able to achieve 100% of what is in their platform, will you be calling for Bernie to be defeated in the hopes that another Trump wins?
Some of us understand that just because Bernie Sanders as President may not get all of his platform passed, it does not mean he just said those things to get elected and planned to sell us all out. I worry that if Bernie wins the nomination and Presidency, you will be here bashing him and trying to tell people he is no better than a right wing Republican to help get him defeated. It is highly unlikely that Bernie will get 100% of what he wants if he is elected, but it would be truly appalling if people start making dishonest and ugly character attacks about how Bernie is really a secret greedy right winger who never wanted his policies to pass.
Elizabeth Warren isn’t “lying” to us. Please stop that kind of attack and start accepting that politicians are running on what they want to achieve. Their platforms are very clear.
If you like that Bernie isn’t calling for a wealth tax but is calling for higher taxes on the wealthy, vote for him. If you like that Bernie will pay for Medicare for All with different taxes than Warren will use, vote for him. But if Bernie wins, please don’t attack him as corrupt and dishonest just because he isn’t able to do 100% of what he wanted to do.
There is a big difference between wanting to raise the taxes on billionaires, even if it may be hard or even impossible, and wanting to slash the taxes that billionaires pay (which happened in 2017).
I will support those who want to try and not deride them for having the right ideas.
A few interesting facts. If you earned a thousand dollars an hour and worked a 40 hour week since the time of Christ,no vacation; Bill Gates would still have 2.5x more wealth than you. Even after the Warren Tax plan.
A wealth Tax has a very long history. It is the real estate tax most Americans pay. And the greatest asset for most Americans is their home. Plenty of home owners with assets under a million already pay a 2% wealth tax. It is a tax that predates the American experience. Many tax collectors in Europe did not have access to your residence, instead they judged your wealth by counting the windows in your home. A lot of cold dark houses with windows painted over stone in France and England. Which leads to the biggest problem of the tax. collecting it from people who have the ability to move that wealth Globally.
Along with the tax would have to come some pretty draconian measures that prevent avoidance.
Reblogged this on David R. Taylor-Thoughts on Education.
I just watched a very interesting interview with former MSNBC financial analyst Dylan Ratigan by Jimmy Dore. Ratigan believes that the changes made by the bankers during the Obama Administration after the crash are causing all the money to be extracted from the US economy by the banks. Ratigan doesn’t believe that a Bernie Sanders presidency will fix the problem. It’s a very interesting interview.
Let’s not panic or cheer, yet. The president, even the rusty, leaky, Orange Dump Truck in the White House, can not write and pass/enact legislation.
Even if Warren wins the election, she will still need someone in one of the Houses of Congress to write and submit the bill (probably OAC in the House if she wins re-election in 2020). And even then, the bill has to get out of the committees in the House and Senate, and then both Houses must pass it, and from what I’ve been reading for months, the odds are very thin that the GOP will lose the Senate majority in 2020.
If Moscow Mitch wins his next election and the GOP keeps its majority in the Senate, that bill will never reach the floor of the Senate for a vote.
Warren’s agenda to tax wealth has a long uphill battle ahead of it if she ends up being the Democratic candidate and wins the 2020 election. That is also a very steep uphill battle in itself.
We can thank both Warren and Bernie for opening up the discussion of raising taxes on those who can afford it most. This, after Trump and McConnell engineered a massive tax cut for the 1% and corporations.
Yes, we can thank them for that. Now we will need people like AOC to keep that alive.
I find this anti Bernie article offensive. He is not a capitalist, true, and yes, Liz is a capitalist to her bones. Bernie’s point is the distribution of wealth has proven that capitalism has run completely amuck, and billionaires need to be held accountable for paying their employees a living wage while also offering them health insurance. He does demonize them for this aspect of their greed, and in being so greedy as to take advantage of their employees, billionaires do need to be demonized, because their behavior is evil.
I agree with your points except- “offering healthcare”. Workers earned and deserve medical care, housing, food, leisure, etc. because they built this nation.
Wall Street drags down GDP by 2%. The fat cats not only erode the gains from labor’s productivity, they steal the value that workers create.