Warren Slams Economists Who Criticize Her Wealth Tax

“You leave two cents with the billionaires, they’re not eating more pizzas.”

Scott Varley/Orange County Register/Zuma

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.

Sen. Elizabeth Warren (D-Mass.) earned huge applause at Thursday night’s Democratic presidential debate by challenging a fundamental economic assumption.

A central component of Warren’s campaign involves a two-cent tax on every dollar of net worth above $50 million. Many economists have said that such a large tax increase could slow economic growth, notwithstanding the shining example of the equalizing potential of taxation: Franklin D. Roosevelt’s 1935 Wealth Tax, which helped mitigate income inequality and pull the country out of the Great Depression.

“How do you answer top economists who say taxes of this magnitude would stifle growth and investment?” moderator Judy Woodruff asked.

“Oh, they’re just wrong,” Warren replied, as the audience burst into cheers.

“For two cents, what can we do?” she continued. “We can provide universal childcare, early childhood education for every baby in this country age zero to five, universal pre-k for every three-year-old to four-year-old, and raise the wages of every childcare worker and preschool teacher.”

She also said that we could improve our public schools and cancel student debt. Then she challenged the disputed notion in trickle-down economic theory that wealthy people help the economy by putting their money back into it.

“You leave two cents with the billionaires, they’re not eating more pizzas,” she said. “They’re not buying more cars.” Instead, she proposed, “we invest that two percent in early childhood education and childcare—that means those babies get top-notch care.”

Watch Warren’s response below:

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate