Democratic presidential candidates backed significantly higher taxes on wealthy individuals and corporations in their debate Saturday night.
Challenged to describe how they would raise revenues for their spending agendas, the Democrats, who have so far shied away from detailed revenue plans, endorsed popular tax hikes.
Hillary Clinton, the front-runner, promised no new taxes on middle-class families, while her two challengers endorsed higher tax rates on top individual taxes and on investments.
“Hard-working middle class families need a raise, not a tax increase,” the former secretary of state said.
With her pledge, she echoed the campaign rhetoric of Barack Obama, who said in running for office the first time that families with income under $250,000 would not see tax increases. Clinton, however, did not specify an income level defining the middle class.
Instead, she claimed that she could pay for her domestic agenda without adding to the debt “by, yes, taxing the wealthy more, closing corporate loopholes, deductions and other kinds of favorable treatment.”
Meanwhile, Vermont senator Bernie Sanders suggested that he would cut tax breaks for corporations while also raising the top income tax rate. His campaign has not yet decided on a top rate, he said, but it would be lower than the to 91 percent marginal rate that prevailed in the Eisenhower administration.
“I’m not that much of a socialist compared to Eisenhower,” the left-wing insurgent joked. The current top rate is 39.6 percent.
Former Maryland Gov. Martin O’Malley suggested that he is open to raising the top rate to 70 percent, the rate that held before Ronald Reagan cut taxes.
Many high income earners, O’Malley said, “love their country enough to do more again in order to create opportunity in America’s middle class.”
O’Malley also recommended raising the tax rate on capital gains, currently 23.8 percent, which he said should be taxed “for the most part” at the same rate that labor income is taxed.
O’Malley, currently lagging in the polls, called the lower tax rate on capital gains an “entitlement that many of our super wealthiest citizens feel they are entitled to pay.”
While Democrats have plans for government spending on college education, infrastructure and much more, they have not yet spelled out plans for raising revenues in detail.
By contrast, almost all the Republicans running for president have presented blueprints for reforming taxes. All the plans so far have involved tax cuts, and many of the candidates have sought to lower top rates on labor income to below 30 percent, in some cases as low as 10 percent. Many in the GOP also favor cutting capital gains taxes, with Sen. Marco Rubio, R-Fla., proposing to eliminated investment taxes altogether.
