Democratic presidential contender Sen. Elizabeth Warren (D-Mass.) said that top economists are “just wrong” when they say her proposed $8 trillion in tax hikes would cause serious damage to the U.S. economy.
While every candidate on the Dec. 19 debate stage has proposed tax hikes, Warren has put forward $8 trillion in proposed tax hikes over the next decade—”the biggest tax increase since World War II,” a debate moderator said.
“How do you answer top economists who say taxes of this magnitude would stifle growth and investment?” she asked.
“Oh. They’re just wrong,” Warren claimed, prompting a round of applause from the audience.
Warren said her wealth tax merely adds a two-cent tax “on the great fortunes in this country, $50 million and above.” With the money garnered from it, America could provide universal early childcare to “every baby in this country, age zero to five,” she said.
The question and answer came after a recent study found that Warren’s proposed wealth tax would raise at least $1 trillion less than what her campaign claims.
Warren’s campaign claimed that the tax would raise $3.75 trillion over a decade, while the team of analysts at the University of Pennsylvania found it would raise $2.7 trillion or less over a decade.
In addition to the shortfall, which Warren’s campaign argues could be narrowed through tougher enforcement, the Penn Wharton Budget Model also projected a GDP contraction of between 1 and 2 percent, “depending on how the money is spent.”
Warren’s is the most aggressive tax-the-rich scheme in the field of Democrats vying for their party’s nomination for the opportunity to challenge President Donald Trump in the 2020 presidential election. Initially, her proposed Ultra-Millionaire Tax targeted high net worth households that earn between $50 million and $1 billion with a 2 percent tax, while households earning above $1 billion would be taxed at 3 percent. That model has since been adjusted upwards with a “4 percent annual Billionaire Surtax (6 percent tax overall) on household net worth above $1 billion.”
The other candidates on stage were former Vice President Joe Biden, businessman Andrew Yang, Sen. Amy Klobuchar (D-Minn.), South Bend Mayor Pete Buttigieg, Sen. Bernie Sanders (I-Vt.), and billionaire Tom Steyer.
A number of other candidates did not meet the threshholds for the debate.
They are: Rep. Tulsi Gabbard (D-Hawaii), Sen. Cory Booker (D-N.J.), former Obama administration cabinet secretary Julian Castro, author Marianne Williamson, billionaire Michael Bloomberg, former Massachusetts Gov. Deval Patrick, Sen. Michael Bennet (D-Colo.), and former Rep. John Delaney (D-Md.).
Tom Ozimek contributed to this report.