Elizabeth Warren Doesn't Understand Wealth Taxes

[squatz1]

Elizabeth Warren released her greatest new idea -- a wealth tax on the super wealthy, would allow for a 2 percent tax on those people net worths that are above 50m.


A one size fits all tax program isn't going to be the way, I don't think that some people don't understand that super wealthy people (such as Jeff Bezos) aren't sitting around with piles of cash thinking about what to do next -- they're people with shares of a company that they're not exchanging on a daily basis. You're going to be taxing them on their networth, which isn't easy to analyze -- as the IRS is going to have to enforce this by looking at all of your assets and determining a market value for these assets.

But let's think about companies that aren't large, privately held companies that don't have values that are public. To verify if you're paying the correct amount, the IRS is going to have to hire private equity analyzers to find out how much a company is worth -- then probably have it disputed by the other side as they may have their team fighting them on the valuation (as they want it to be lower, to pay less in taxes)

None of this even harps on the fact that taxes on wealth are going to cause capital to leave the country and stifle innovation, as people are going to look towards ways to avoid this tax.

Also, there are multiple arguments about the constitutionality of such legislation -- as the Income Tax amendment doesn't allow for a tax on wealth by the Federal Government.

This is a pipe dream and without a doubt a way to try to please the base.

Let's see what everyone else thinks here.

Some random articles:
https://www.wsj.com/articles/elizabeth-warren-doesnt-understand-wealth-taxes-11549228772?mod=hp_opin_pos1
https://www.city-journal.org/elizabeth-warren-wealth-tax

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[Quickseller]

She doesn’t understand economics either.

[TECSHARE]

It could be worse...

[theymos]

If any wealth tax is imposed, that's basically the end of the US as a major economy. While Warren's proposal would only affect a tiny percentage of the population, it'd probably directly lead to economic and societal collapse, massively encouraging wasteful spending and discouraging savings, risk, and investment. It's also a slippery slope to ever-increasing wealth taxes.

It could be worse...

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

[Quickseller]

The wealth tax is actually unconstitutional. The 16th amendment says

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration

The 10th amendment says:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

As such, since the constitution only allows congress to tax incomes, and not assets, a wealth tax is unconstitutional.

The estate tax is constitutional because it is not actually taxing assets directly, but the transfer of assets from the deceased to their estate.

[TECSHARE]

This problem needs to be fixed at its source. The Federal Reserve Bank.

[squatz1]

The wealth tax is actually unconstitutional. The 16th amendment says

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration

The 10th amendment says:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

As such, since the constitution only allows congress to tax incomes, and not assets, a wealth tax is unconstitutional.

The estate tax is constitutional because it is not actually taxing assets directly, but the transfer of assets from the deceased to their estate.

So with this said, the states would be allowed to levy a wealth tax -- just not the Federal Government, right?

[TECSHARE]

The wealth tax is actually unconstitutional. The 16th amendment says

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration

The 10th amendment says:

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

As such, since the constitution only allows congress to tax incomes, and not assets, a wealth tax is unconstitutional.

The estate tax is constitutional because it is not actually taxing assets directly, but the transfer of assets from the deceased to their estate.

So with this said, the states would be allowed to levy a wealth tax -- just not the Federal Government, right?

If it is unconstitutional, that applies to states too.

[coins4commies]

I don't like Elizabeth Warren's proposal because I don't see a direct purpose behind it.  What is it trying to accomplish other than "stick it to the rich"? Taxing wealth isn't going to provide anything for the poor.    The green new deal is a great plan that will accomplish many things.  Our goal shouldn't be to stick it to the rich for the sake of taking their money. 

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

This is flatout a lie and propaganda from the rich. 

https://www.vox.com/policy-and-politics/2019/1/4/18168431/alexandria-ocasio-cortez-70-percent

MIT’s Peter Diamond and Berkeley’s Emmanuel Saez relaunched this debate with a landmark 2012 paper that argued for a 73 percent top income tax rate in the United States.

2016 paper from Benjamin Lockwood, Charles Nathanson, and Glen Weyl argues that confiscatory taxation would be good for the economy because it would discourage talented people from entering lucrative lines of work

[TECSHARE]

I don't like Elizabeth Warren's proposal because I don't see a direct purpose behind it.  What is it trying to accomplish other than "stick it to the rich"? Taxing wealth isn't going to provide anything for the poor.    The green new deal is a great plan that will accomplish many things.  Our goal shouldn't be to stick it to the rich for the sake of taking their money. 

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

This is flatout a lie and propaganda from the rich. 

https://www.vox.com/policy-and-politics/2019/1/4/18168431/alexandria-ocasio-cortez-70-percent

MIT’s Peter Diamond and Berkeley’s Emmanuel Saez relaunched this debate with a landmark 2012 paper that argued for a 73 percent top income tax rate in the United States.

2016 paper from Benjamin Lockwood, Charles Nathanson, and Glen Weyl argues that confiscatory taxation would be good for the economy because it would discourage talented people from entering lucrative lines of work

I agree there seems to be too much focus on pretty much anyone who has more than you being automatically bad some how and therefore an excusable target to rob. I however don't think any of these plans are viable. Regarding the paper, perhaps instead of taxing people so much they leave, we should end the easy money inflationary casino banking system we have that is creating these market distortions that are causing all of these problems to begin with.

All the engineers, doctors, and scientists we need in their specialized field of training are seeing their investor and stock market buddies make bank doing nothing all day and leaving the jobs where we need them because it pays more. The only reason that works is because The Federal Reserve Bank is pumping a fire hose of fiat cash into these markets in various forms. This also causes distortions in the valuations of raw materials and no longer fairly represents their true market value, causing all kinds of problems up and down the supply chain.

The reason everyone feels like they are getting fucked is because they are, just not in the way they think. They are constantly robbing buying power out of your wallet while simultaneously taxing you more (IRS is the collection arm of The Federal Reserve Bank) as your dollar amount of pay goes up to keep up with inflation. You are now "making more" even though the buying power of each dollar is less.

So while the people playing the casino game have a tap into the easy money, the remainder not drawn in by the cash are left to run society at rates that are not in proportion to what they should be buying power wise. There is a giant boot on the neck of the US and the world economy and it is called The Federal Reserve Bank. It is holding us down while it slowly bleeds us dry until the point we can not resist any more. Then it will clean our bones, then crush them up for fertilizer. They have done it before, and they are doing it again if we don't stop them.

[Butterscotch Cartman]

If any wealth tax is imposed, that's basically the end of the US as a major economy. While Warren's proposal would only affect a tiny percentage of the population, it'd probably directly lead to economic and societal collapse, massively encouraging wasteful spending and discouraging savings, risk, and investment. It's also a slippery slope to ever-increasing wealth taxes.

It could be worse...

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

Funny because the main thing leading to societal collapse is wealth inequality.  lets keep letting ownership steal the value that laborers create.  Profit is the unpaid value that the workers created.

[mayo2u]

This problem needs to be fixed at its source. The Federal Reserve Bank.

I don't think the Federal Reserve is the cause of this - unless you mean Federal Reserve is opposed to Gold.  I think the philosophical viewpoint that an government is the primary tool to solve social ills is the central issue that needs to be combated.

[Astargath]

If any wealth tax is imposed, that's basically the end of the US as a major economy. While Warren's proposal would only affect a tiny percentage of the population, it'd probably directly lead to economic and societal collapse, massively encouraging wasteful spending and discouraging savings, risk, and investment. It's also a slippery slope to ever-increasing wealth taxes.

It could be worse...

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

Funny because the main thing leading to societal collapse is wealth inequality.  lets keep letting ownership steal the value that laborers create.  Profit is the unpaid value that the workers created.

''Funny because the main thing leading to societal collapse is wealth inequality'' Prove it

[Spendulus]

If any wealth tax is imposed, that's basically the end of the US as a major economy. While Warren's proposal would only affect a tiny percentage of the population, it'd probably directly lead to economic and societal collapse, massively encouraging wasteful spending and discouraging savings, risk, and investment. It's also a slippery slope to ever-increasing wealth taxes.

It could be worse...

AOC's 70% progressive-income-tax proposal is very bad, but it's a lot better than any wealth tax. The economy could basically continue, though very fettered, under such a system.

It's often argued that we had 70% taxes in the 1920s and thereafter, so why not do it again?

The difference is that. back then there were a large variety of loopholes written into the tax law. The resulting average rates were around 22-24%. Nobody actually paid 70%.

Back then, we had a system that politicians could say fleeced the rich, while in reality they grew fat and rich on it.

[BADecker]

Taxes are apportioned as equally as possible. This means that if the wealthy are taxed, they will all be taxed somewhat equally. Where do they get their money to pay their taxes? They pass it on to us little people by increasing the price of their products and services they sell to us.

Elizabeth Warren knows this. She is simply trying to make herself look popular in the eyes of the simple minded Dems who DON'T know this, so that she might get elected to something next time around.

[Astargath]

Taxes are apportioned as equally as possible. This means that if the wealthy are taxed, they will all be taxed somewhat equally. Where do they get their money to pay their taxes? They pass it on to us little people by increasing the price of their products and services they sell to us.

Elizabeth Warren knows this. She is simply trying to make herself look popular in the eyes of the simple minded Dems who DON'T know this, so that she might get elected to something next time around.

They don't have to increase the price of anything to make money, though, their services will always cost money.

[BitBustah]

If anyone is considered a leech on society it should be the wealthy.  They make money off renting houses, dividend paying stocks, etc.  They make money off OTHER peoples work.  No one is self made, without society their inventions would have never been successful.  We should all be a team working for a greater goal, not fighting against each other.

[TECSHARE]

We should all be a team working for a greater goal, not fighting against each other. If anyone is considered a leech on society it should be the wealthy.

You contradict yourself in your own statement. Again this is a classic case of "anyone who has more than me is bad". How about instead of focusing on them, you focus on the system that allowed them to do this? Such as the system I described above in detail that pumps the money to that class while the working class save burning currency and stay on a financial treadmill. The people who are our real enemies aren't even on that chart and no one here has ever heard their names. The people you are blaming are not our enemies, and to a certain extent we still need quite desperately.

[KingScorpio]

Elizabeth Warren released her greatest new idea -- a wealth tax on the super wealthy, would allow for a 2 percent tax on those people net worths that are above 50m.


A one size fits all tax program isn't going to be the way, I don't think that some people don't understand that super wealthy people (such as Jeff Bezos) aren't sitting around with piles of cash thinking about what to do next -- they're people with shares of a company that they're not exchanging on a daily basis. You're going to be taxing them on their networth, which isn't easy to analyze -- as the IRS is going to have to enforce this by looking at all of your assets and determining a market value for these assets.

But let's think about companies that aren't large, privately held companies that don't have values that are public. To verify if you're paying the correct amount, the IRS is going to have to hire private equity analyzers to find out how much a company is worth -- then probably have it disputed by the other side as they may have their team fighting them on the valuation (as they want it to be lower, to pay less in taxes)

None of this even harps on the fact that taxes on wealth are going to cause capital to leave the country and stifle innovation, as people are going to look towards ways to avoid this tax.

Also, there are multiple arguments about the constitutionality of such legislation -- as the Income Tax amendment doesn't allow for a tax on wealth by the Federal Government.

This is a pipe dream and without a doubt a way to try to please the base.

Let's see what everyone else thinks here.

Some random articles:
https://www.wsj.com/articles/elizabeth-warren-doesnt-understand-wealth-taxes-11549228772?mod=hp_opin_pos1
https://www.city-journal.org/elizabeth-warren-wealth-tax

she sells the entire billionaire club, for the presidency.

[BADecker]

Taxes are apportioned as equally as possible. This means that if the wealthy are taxed, they will all be taxed somewhat equally. Where do they get their money to pay their taxes? They pass it on to us little people by increasing the price of their products and services they sell to us.

Elizabeth Warren knows this. She is simply trying to make herself look popular in the eyes of the simple minded Dems who DON'T know this, so that she might get elected to something next time around.

They don't have to increase the price of anything to make money, though, their services will always cost money.

Nobody is required to use their products and services. There are places in the Appalachian Mountains where they make almost all their own goods. And look at the Amish, for example. But that wasn't the point.

The point was that Warren is trying to make herself look good by talking taxing the rich... who will just pass any taxes on to the poor who buy their products and services.