Five years and political ambition make all the difference. Sen. Elizabeth Warren, D-Mass., has come out in favor of a wealth tax ahead of the Democratic presidential primary.
The Warren plan was previewed by two leftist economics professors from the University of California, Berkley: Emmanuel Saez and Gabriel Zucman. They tell the Washington Post that Warren will propose a 2 percent wealth tax on individuals with assets worth more than $50 million and a 3 percent wealth tax on individuals with more than $1 billion.
“The Warren wealth tax is pretty big. We think it could have a significant effect on wealth concentration in the long run,” Saez said in an interview. “This is a very interesting development with deep root causes: the fact inequality has been increasing so much, particularly in wealth, and the feeling our current tax system doesn’t do a very good job taxing the very richest people.”
Policy aside, it is also a very interesting political development. Warren has been a progressive superstar for some time. As a freshman senator, though, she stopped short of endorsing the idea.
Warren was railing against income inequality as a Harvard Law professor and long before coming to Congress. Warren stopped well short, however, of endorsing the key progressive prescription against evening the economic scales between the rich and poor.
Asked by HuffPost in 2014 whether or not she endorsed the wealth tax, Warren dodged.
“I want to put it this way: We need to take a hard look overall at our approach to taxation,” Warren said. “That includes every part of it — [the tax code] has become so riddled with loopholes and exceptions that were lobbied in by powerful corporations and individuals with buckets of money. You don’t want to start with any one part of it, because that isn’t the point. The point is the whole thing has to be on the table at once.”
Now that the White House is on the table, Warren has warmed up to the idea. Less than an hour after the Washington Post reported on her conversion, Jared Bernstein, a former chief economist to Vice President Joe Biden, praised her in those same pages.
“To give Warren the last word, the economy — more precisely, the tax code — is rigged,” Bernstein concluded. “True, this plan isn’t going to become law anytime too soon, but those of us longing to de-rig the economy are in it for the long haul. So, thanks, Senator, for providing us with an inspiring idea whose time has come.”
