Elizabeth Warren Wants a Wealth Tax Despite the Fact That it's Unconstitutional

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If you thought the Native American story was a whopper, check out Warren's new plan to expand government.

Tax the rich. Tax the rich. Just take it. That is the message from progressives.

Here is Warren's Press Release.

United States Senator Elizabeth Warren (D-Mass.) today unveiled the Ultra-Millionaire Tax, a bold proposal to tax the wealth of the richest 0.1% of Americans. The legislation, which applies only to households with a net worth of $50 million or more, is estimated by leading economists to raise $2.75 trillion in tax revenue over a ten-year period.

For decades, a small group of families has raked in a massive amount of the wealth American workers have produced, while America’s middle class has been hollowed out. The result is an extreme concentration of wealth not seen in any other leading economy.

The Ultra-Millionaire Tax taxes the wealth of the richest Americans. It applies only to households with a net worth of $50 million or more-roughly the wealthiest 75,000 households, or the top 0.1%. Households would pay an annual 2% tax on every dollar of net worth above $50 million and a 3% tax on every dollar of net worth above $1 billion. Because wealth is so concentrated, Saez and Zucman project that this small tax on roughly 75,000 households will bring in $2.75 trillion in revenue over a ten-year period.

Sound good?

Think again. Please consider Elizabeth Warren’s Unconstitutional Wealth Tax.

As she seeks the 2020 presidential nomination of the Democratic party, Sen. Elizabeth Warren is giving voters fair warning that she does not accept the Constitution’s limits on federal power. On Thursday the former Harvard law professor unveiled a plan to extract wealth from the country’s wealthiest citizens.

The “leading economists” cited by Team Warren are Emmanuel Saez and Gabriel Zucman from the University of California-Berkeley.

No doubt many economists will also explain in the days to come why the Warren tax would not raise as much as Messrs. Saez and Zucman expect and how it would distort investment and encourage capital flight from the United States. Ms. Warren implicitly acknowledges this last problem. Her plan includes “a significant increase in the IRS enforcement budget” and “a 40% ‘exit tax’ on the net worth above $50 million of any U.S. citizen who renounces their citizenship.”

There are excellent economic arguments against this new tax plan. But today this column would like to focus on the illegality of the Warren scheme. Ms. Warren seems to understand this problem as well. Typically lawmakers announcing new legislation don’t feel the need to simultaneously try to rebut anticipated claims that the bill is unconstitutional. But the Warren press release links to two letters on the subject, each signed by various law professors at famous universities.

No matter how many academics she persuades to sign on to this ideological project, the plain fact is that the founders specifically prohibited such a tax. A well-informed reader notes: The 16th Amendment authorizes Congress to tax “incomes, from whatever source derived.” It does not give Congress the power to tax balance sheets as well.

Voters can choose to believe that Ms. Warren’s wealth tax would only hit those with enormous wealth. But given the damage she intends to wreak on constitutional limited government, why should they?

Just a Start

These ideas are just a start. Please note that Democrat Presidential Hopeful Wants to Give Everyone $1,000 a Month Free Money.

I estimated the cost of that to be about $2.4 trillion a year.

Wealth in Wrong Hands

Also note New York Mayor Says "Wealth in Wrong Hands", So, We'll Take It

New Green Deal

Finally, please ponder ponder the Green New Deal and Medicare for All Proposal by newly elected progressive illiterate wonderkind Alexandria Ocasio-Cortez.

She proposes spending $1 trillion to save the planet. Others more realistically estimate the cost of her plan at $40 trillion.

Medicare for all will cost on the order of $32 trillion.

So in addition to the wealth tax being unconstitutional, it will soon have to pay for all sorts of crazy ideas that will go far beyond confiscating ALL the wealth of anyone who has anything.

Mike "Mish" Shedlock

Comments
No. 1-23
Proffessor
Proffessor

These 75,000 wealthy families will by tomorrow night have advice from their accountants and financial advisors what measures to take to either avoid this theft or at least to minimize its affect and the options are vast . The odds of Warren becoming President are remote but these people do not take chances . When completed these measures will probably cut down the tax to be paid by 50 -75% and will be very bad news for the US economy .

everything
everything

Ehhh, let the U.S. collapse unto itself when the debt can no longer be increased, however that may work, the rich can run off to New Zealand like they planned. I don't care about Warren or any of them. When or if we get another recession the job cuts will be so deep as they usually are, we won't know wtf hit us. The youth I know aren't even considering saving for retirement anymore, the only ones who are - are the immigrants who know they can make enough here in about 5 years to go back home and have something, being that they don't have the government overhead to take it all away, us permanent residents will just stay broke paying taxes and health care costs, and yeah that's the only good reason to increase wages, so the states and corporations can just suck it back in.

pvguy
pvguy

Ignoring whether or not it's a good idea, why would a wealth tax be unconstitutional? Estate taxes are constitutional, and a wealth tax basically a while still alive estate tax.

ML1
ML1

Hollowing out of the middle class and economic destruction of the working class has been enabled by massive illegal immigration which has stagnated and lowered wages of tens of millions of Americans.

However Warren is all for open borders and continued massive illegal immigration.

Warren is a leftist-hypocrite in addition to being economically incompetent and being a fantasist liar with her Indian background.

This person took a place from some deserving real American-Indian or African-American because Warren was hired because universities where she worked wanted to increase diversity and even touted her diversity after hiring her despite now claiming that Warren was hired for her talents after Warren's diversity charade was proven to be a 1/1024th LIE.

Instead of confiscating money from the rich the correct way to fight inequality would be to force corporations to pay better wages through working of open markets by stopping further illegal immigration and deporting the 29.5 million illegal immigrants currently in USA (MIT-Yale study).

With no illegals to lower wages companies would be forced through market forces to pay higher wages.