Tag: Bernie Sanders

The Limits of Taxing the Rich

Mary Pat Campbell

Link:https://manhattan.institute/article/the-limits-of-taxing-the-rich

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Sanders’s agenda is not limited to taxes on corporations and wealthy families. The campaign also proposed to partially finance Medicare-for-All through 4.6% of GDP in new tax revenues from broad-based payroll taxes and tax-preference eliminations (within health care). However, even if one uses the inflated revenue figure of 8.6% of GDP (4.0% from the wealthy and 4.6% from broad-based taxes), it still falls far short of financing Sanders’s spending promises. Sanders proposed $23 trillion in new taxes over the 2021–30 period, yet also proposed a $30 trillion Medicare-for-All plan, $30 trillion government job guarantee, $16 trillion climate initiative, and $11 trillion for free public college tuition, full student-loan forgiveness, Social Security expansion, housing, infrastructure, paid family leave, and K–12 education. That is $87 trillion in spending promises, on top of a baseline budget deficit that, at the time, was forecast at $13 trillion over the decade.[104] Even the rosiest revenue estimates of Sanders’s tax policies would cover only a small fraction of his spending promises (see Figure 9).

At the same time, Sanders has obfuscated the funding shortfall by: 1) regularly claiming that his tax policies can cover all his spending promises, even as official scores show otherwise; and 2) proposing most spending increases separately, in order to make each one appear individually affordable within his broader tax agenda.

Summary: Some progressives suggest that Bernie Sanders has identified extraordinary potential revenues from taxing the rich. However, his proposed tax increases on corporations and wealthy individuals show revenues of 4% of GDP—and that is before accounting for constitutional challenges and unrealistic tax rates that far exceed the consensus of revenue-maximizing rates. Given behavioral and economic responses, the total potential tax revenues are (at most) 2% of GDP, and possibly far less. Indeed, leading progressive tax officials assume plausible tax rates and revenues far below those of Sanders’s proposals. Even assuming Sanders’s full static revenue estimate and including his steep middle-class tax proposals would not come close to paying for his spending agenda. The contention that Sanders has unlocked an enormous tax-the-rich revenue source is false.

Author(s): Brian Riedl

Publication Date: 21 Sept 2023

Publication Site: Manhattan Institute

Sanders’ Social Security Bill Would Extend Payroll Tax to Capital Gains for High Earners

Mary Pat Campbell

Link:https://www.thinkadvisor.com/2022/06/10/bernie-sanders-new-social-security-bill-would-extend-payroll-tax-to-capital-gains-for-high-earners/

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Sen. Bernie Sanders, I-Vt., and Rep. Peter DeFazio, D-Ore., introduced Thursday the Social Security Expansion Act (SSEA), which would, among other measures, boost benefits, adopt the Consumer Price Index for the Elderly, or CPI-E, for benefit increases, and subject all income above $250,000 — including capital gains — to the Social Security payroll tax.

Dan Adcock, Director of Government Relations and Policy at the National Committee to Preserve Social Security and Medicare, told ThinkAdvisor Friday in an email that the DeFazio-Sanders bill, like the Social Security 2100: A Sacred Trust, introduced by Rep. John Larson, D-Conn., “both extend solvency and improve benefits.”

The Larson bill, however, “is consistent with President Biden’s pledge not to raise taxes on Americans earning less than $400,000 per year,” Adcock said, while “the Sanders-DeFazio bill is not.”

A Sacred Trust adopts the consumer price index for the elderly as the basis of the annual cost-of-living adjustment (COLA) and applies the payroll tax to annual wages above $400,000.

Author(s): Melanie Waddell

Publication Date: 10 June 2022

Publication Site: Think Advisor

Who’s Missing From The ‘Build Back Better’ Reconciliation Bill? The Elderly And Disabled Poor

Mary Pat Campbell

Link:https://www.forbes.com/sites/ebauer/2021/10/10/whos-missing-from-the-build-back-better-reconciliation-bill-the-elderly-and-disabled-poor/

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In recent articles, I have lamented poorly designed components of the Reconciliation Bill, from a poorly-designed “free childcare” program to a family leave plan that’s designed to be “free” rather than funded by the workers who benefit, to a Medicare drug benefit that’s planned to be implemented at the same time as Part A Medicare is facing insolvency, to a mandate that employers provide retirement plan access that leaves virtually all of the specifics up to a bureaucratic agency. And this just scratches at the surface of the expansive programs on tap if the bill is passed as currently drafted. But there’s one piece of legislation that advocates have been calling for, for years, which didn’t make the cut: an increase in the benefits for the poorest of the poor elderly and disabled who receive Supplemental Security Income, or SSI.

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So why didn’t SSI make the cut, when the Democrats compiled their list of programs for the “American Family Plan”? Do some of these changes go too far, increase benefits too much? Did they want to avoid opening up a can of worms with respect to larger plan design issues with the system, for example, concerns that the children’s benefits have become an “alternative welfare system” providing benefits for children equal to those for adults, even with mild conditions such as ADHD, that mean no one wants to touch the system?

Or does an enhancement of SSI benefits simply fail to meet the Democrats’ objective of making voters happy with broad outlays of cash benefitting the middle class as well as the poor?

Author(s): Elizabeth Bauer

Publication Date: 10 Oct 2021

Publication Site: Forbes

Note to Bernie: The 8 arguments for restoring the SALT deduction, and why they’re all wrong

Mary Pat Campbell
Note to Bernie: The 8 arguments for restoring the SALT deduction, and why they’re all wrong

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We have argued against lifting the $10,000 cap in the New York Times, the Washington Post, and in a short analysis for Brookings. Our case is quite straightforward: the benefits of repeal would flow to the rich and affluent, who now have a disproportionate influence on the Democratic Party. To be specific, the top 1 percent would get an average tax cut of over $35,000. The middle class would get an average tax cut of about $37 (note that our analyses here relate to full repeal, since we do not know yet what alternative Sen. Sanders has in mind):

Author(s): Richard V. Reeves, Christopher Pulliam

Publication Date: 24 June 2021

Publication Site: Brookings

Pay a Living Wage or ‘Flip Your Own Damn Burgers’: Progressives Blast Right-Wing Narrative on Jobs

Mary Pat Campbell

Link: https://www.commondreams.org/news/2021/05/07/pay-living-wage-or-flip-your-own-damn-burgers-progressives-blast-right-wing

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Soon after the Labor Department released its April jobs report, the U.S. Chamber of Commerce blamed last month’s weak employment growth on the existence of a $300 weekly supplemental jobless benefit and began urging lawmakers to eliminate the federally enhanced unemployment payments that were extended through early September when congressional Democrats passed President Joe Biden’s American Rescue Plan. 

“No. We don’t need to end [the additional] $300 a week in emergency unemployment benefits that workers desperately need,” Sen. Bernie Sanders (I-Vt.) said in response to the grumbles of the nation’s largest business lobbying group. “We need to end starvation wages in America.”

“If $300 a week is preventing employers from hiring low-wage workers there’s a simple solution,” Sanders added. “Raise your wages. Pay decent benefits.”

Author(s): Kenny Stancil

Publication Date: 7 May 2021

Publication Site: Common Dreams

Bernie Sanders Is (Mostly) Right About the SALT Deduction

Mary Pat Campbell
Bernie Sanders Is (Mostly) Right About the SALT Deduction

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“I want to tell you this: If I become majority leader, one of the first things I will do is we will eliminate it forever,” Schumer said during a July 14 press conference on Long Island. “It will be dead, gone, and buried.”

“It” in this case was the cap on the state and local tax (SALT) deduction, which was imposed as part of the 2017 federal tax reform bill passed by Republicans and signed by President Donald Trump. As a result of that law, Americans are allowed to deduct a maximum of $10,000 in state and local tax payments from their federally taxable income; previously the deduction was uncapped, and it overwhelmingly benefitted the richest households while shifting their federal tax burden to everyone else.

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Sen. Bernie Sanders (I–Vt.) is correct to point out, as he did in an interview with Axios this week, that the SALT cap creates a serious optics problem for Democrats. Sanders says he will oppose Schumer’s effort to attach the SALT cap repeal to the transportation bill because “it sends a terrible, terrible message when you have Republicans telling us that this is a tax break for the rich.”

Author(s): Eric Boehm

Publication Date: 11 May 2021

Publication Site: Reason

Dem tax rift: Sanders rips Pelosi, Schumer for backing repeal of SALT cap

Mary Pat Campbell

Link: https://nypost.com/2021/05/10/sanders-rips-pelosi-schumer-for-backing-repeal-of-salt-cap/

Excerpt:

​Sen. Bernie Sanders is taking on the leaders of his own Democratic Party — Senate Majority Leader Chuck Schumer and House Speaker Nancy Pelosi — for supporting a repeal of the cap on deductions for state and local tax on federal income taxes.

Pelosi (D-Calif.) and Schumer (D-NY) — who represent two of the highest tax states — back repealing the $10,000 cap instituted by former President Donald Trump on SALT deductions, which Sanders said “sends a terrible, terrible message” to working-class people.

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“We could reverse that for 2018 and 2019 so that people could refile their taxes” and get a refund, Pelosi told The Times in March. “They’d have more disposable income, which is the lifeblood of our economy, a consumer economy that we are.”

Author(s): Mark Moore

Publication Date: 10 May 2021

Publication Site: NY Post