Elizabeth Warren 2020 campaign megathread

[True Federalist (진정한 연방 주의자)]

Proposing a patently unconstitutional wealth tax this early in the campaign doesn't exactly indicate she's a serious thinker. Taxes on assets instead of income are direct taxes and thus unconstitutional unless apportioned among the States on the basis of their electoral votes. That's never going to happen.

About the only way I could see something like this being constitutional would be as a prepayment of estate tax. (The estate tax is not a direct tax because it doesn't tax the assets a person holds but those that are being transferred from the dead person.

[True Federalist (진정한 연방 주의자)]

Regardless of the merits of any Medicare for All plan, there are three glaring problems in how she proposes to pay for it.

1) If it were so easy to increase compliance with the existing tax code to raise more money, why isn't it already being done?  Even if there is money to be gained there, it'll require spending considerably more in auditing costs and the like, so not every dollar gained will be available for other uses.

2) Taxing unrealized capital gains is a horribly stupid idea. Even if only done for marketable securities, it'll be a bureaucratic nightmare.  There's solid reasons why GAAP and IFRS (the two main sets of accounting standards) generally don't allow accruing capital gains (or losses) on an entity's books except when an asset is sold. Moreover, this doesn't really increase taxable income, just does a one-time shift earlier in time, at the cost of a massive increase in compliance and record-keeping costs, so it robs the future to pay the present.

3) There's zero chance that her wealth tax proposal won't be considered to be a direct tax by the Supreme Court.  Existing precedent is quite clear that an ad valorem property tax (which is what her wealth tax is) is a direct tax under the Constitution and thus has to be apportioned by State according to their Representatives.  That will make any wealth tax unmanageable.  If you want to tax the wealthy, there are plenty of other non-direct tax ideas out there to do that, of which the simplest would be to reduce or eliminate the cuts in estate taxes that have happened in the last couple of decades.

At least I have the luxury of living in a non-swing State and thus will have no reason to vote for her even if she gets the nomination.

[True Federalist (진정한 연방 주의자)]

1) If it were so easy to increase compliance with the existing tax code to raise more money, why isn't it already being done? 

Because Congress has gutted the IRS

And how will being tied to a healthcare proposal make ungutting the IRS any easier? As a way to help the general fisc it's a good idea, but tying it to a specific spending proposal as a means to fund that specific proposal is as smoky and mirrory as politics gets. Including it as something to deal with healthcare just convinces me how little she cares about the issue. Combined with her other revenue raising ideas, it convinces me the Democrats will be much better off with her nowhere near the ticket and she stays in the Senate, at least for now.

[True Federalist (진정한 연방 주의자)]

The IRS can indeed go after rich tax cheats.  Under the Trump administration, they have deliberately changed their priorities away from auditing wealthy people and toward auditing poor people.  This is something that can be changed with by executive order without any need of Congress.

The reason the IRS is targeting poors is that their tax returns take less effort to audit and thus on purely fiscal grounds, it's the most effective use of their limited budget. To go after more of the more complicated returns will require Congressional action to restore funding for audits.

[True Federalist (진정한 연방 주의자)]

The reason the IRS is targeting poors is that their tax returns take less effort to audit and thus on purely fiscal grounds, it's the most effective use of their limited budget. To go after more of the more complicated returns will require Congressional action to restore funding for audits.

 Republicans created this scenario, this is what they want by design. Let their wealthy donors skate and punish the poor.

 There is much more money to be recovered and bigger penalties if you go after rich tax cheats. The impotence to do so is a political will problem and not truly a fiscal one.

Agreed, but that's all the more reason not to use hypothetical numbers from improved tax compliance as a funding source for any spending (or tax cut) proposal.

Her other proposed ways to pay for M4A are also problematic and/or simply idiotic.