Warren Buffett Joins the Tax-the-Rich Chorus
Noted McDonald’s breakfast enthusiast Warren Buffett is no stranger to the American tax debate. He’s famous for endorsing the “Buffett Rule” that proposes no millionaire should pay a lower effective tax rate than a working person. In a new interview that aired on CNBC on Monday, Buffett again injected himself into the politics of inequality insisting: “The wealthy are definitely under-taxed relative to the general population.”
The 88-year-old’s comments add chum to the tax-the-rich waters. Sen. Bernie Sanders (I-VT) has proposed increasing the estate tax up to 77 percent for billionaires. Sen. Elizabeth Warren (D-MA) has called for an annual wealth tax to be imposed on fortunes greater than $50 million. Rep. Alexandria Ocasio Cortez (D-NY) has called on a 70-percent tax bracket for those with annual incomes in excess of $10 million. All of these policy proposals are a hit with voters, according to recent polling.
Buffett, who is worth more than $80 billion, used his CNBC interview to endorse a redistribution of wealth to counteract an economy that’s rewarding those at the very top. “As we get more specialized, the rich will get richer,” he said. “The question is: How do you take care of a guy who is a wonderful citizen, whose father died in Normandy, and just doesn’t have market skills? I think the income tax credit is the best way to address that.”
Buffett alludes to policies like the Earned-Income Tax Credit, a wage subsidy administered through the federal tax code. Several mainstream Democratic presidential candidates (and those flirting openly with runs) have called for an expansion of the EITC, or a similar mechanism to increase the standard of living for America’s workers.
The central policy put forward by candidate Sen. Kamala Harris (D-CA) is the LIFT Act which would pay out as much a $500 per month to working families. Sen. Sherrod Brown (D-OH) has put forward the GAIN Act, which would double the benefits of the existing EITC and massively expand them for workers without children.
Not all Democrats in the 2020 field think the rich need to be targeted to increase working-class incomes. Candidate Andrew Yang wants to impose a flat, European style Value Added Tax or VAT to pay for a Freedom Dividend of $1,000 a month for every American adult.For more on the signature policies of the field read through our rankings at the RS Politics 2020 Democratic Primary Leaderboard.