This is not me saying that, but the almost canonical—for liberals—NYT. As we have known for months now—and I have said on this page a number of times—Warren and company are out to “redistribute wealth,” by carrying out “an enormous transfer of money from the wealth to ordinary people.”
It feels good to know that the NYT knows exactly what the Democrats are up to and is willing to say so.
But Alan Rappeport and Thomas Kaplan, the authors of the article, deserve a lot of credit for recognizing that we are not just dealing here with an obligatory run-of-the-mill promise to raise taxes on the wealthy, but something much bigger, and I would add, ominous: An economic paradigm-shift of enormous proportions.
“Progressive Democrats [Warren and Sanders] are advocating the most drastic shift in tax policy in over a century as they look to redistribute wealth and chip away at the economic power of the superrich with new taxes that could fundamentally reshape the United States economy” (italics, mine).
Folks, I don’t know what you think, but to me this sounds like a radical overhaul of the American economic system, guided by the socialist principles of eliminating billionaires (as Sanders said) and transferring wealth to the working class (the “ordinary” people in Democratic euphemistic double-speak).
Democrats don’t like comparisons to Castro and Maduro, but both of these “leaders” engaged in a drastic re-engineering of the economies of their countries—with the goal of confiscating wealth from the rich, redistributing it to the ordinary people, and funding their socialist programs—comparable in scope to what Warren and Sanders are proposing.
The methods used might be different—nationalization and confiscation in the case of Castro and Chavez, hyper-taxation in the case of Sanders and Warren—but the results and the consequences for the economy would be the same:
‘Their plans envision an enormous transfer of money from the wealthy to ordinary people, with revenue from the wealth tax used to finance new social programs like tuition-free college, universal child-care [sic] and “Medicare for all.”’
Government takes away your wealth and gives to others (because you don’t need all that money), wealth and productivity shrink, you print money and inflation goes through the roof (as in Venezuela), and the wealth and the wealthy exits the country, and with it jobs and economic growth.
Ah, but I am afraid Warren and Sanders are smarter than that. They got one ace up their sleeve. The billionaires in the U.S. have no place to go. The U.S. is the end of the line. The rich are trapped, and they will have no choice but to fork over that wealth when the IRS comes demanding it. After all, all Warren and Sanders want is to cut their wealth by one-fifth or one-half. They got the rich pinned to the wall, with no place to run to, so to speak. Unfortunately, Warren and Sanders would be right.
I don’t think some of the critics of the Warren and Sanders proposals understand the full implications of what they want to do. The critics argue, in my view correctly, that their proposals “would cripple economic growth, sap the motivation of entrepreneurs who aspire to be multimillionaires and set off a search for loopholes.”
Yes, to the first two. But the last, the search for loopholes still presupposes that our economic system under the new status quo would be continuous with the system we have had for the “last hundred years.”
The conclusion Rappeport and Kaplan implicitly draw—in spite of themselves, and against their liberal instincts—is that the (socialist) transformation of the economy would be so “drastic” (i.e. radical) that looking for loopholes would not even make sense in the new economic order engendered by the Warren-Sanders remaking of the American economy!
The massive shock to the system would be so great that any continuity the economy that we have known, again, for the last 100 years, would be shattered; and thus there would be no to place to which either the rich or the poor could run for cover.
What Warren and Sanders want to do—even though I don’t think they themselves see it and vehemently would deny it—would be so anomalous and dramatic, that eventually under their new economic paradigm the total collapse and disintegration of the U.S. economy, just as it happened in Venezuela, would be unavoidable.