Congresswoman Calls for Staggering Tax Rate for Rich, 'As High as 90 Percent'
Freshman Democratic Congresswoman Ilhan Omar of Minnesota suggested the way to pay for Medicare for all and other new government programs she has proposed is to tax the wealthiest Americans upwards of 90 percent.
While appearing on “Through Her Eyes” on the Roku channel Tuesday night, host Zainab Salbi asked Omar, “How do you propose doing that on a very practical level, because some of these critics are coming from the Democratic Party itself, not only the Republican Party?”
“There are a few things that we can do,” Omar replied, according to Yahoo News. “One of them, is that we can increase the taxes that people are paying who are the extremely wealthy in our communities. So, 70 percent, 80 percent, we’ve had it as high as 90 percent. So, that’s a place we can start.”
.@IlhanMN supports taxing the wealthiest Americans up to 90 percent. For her full interview with #ThroughHerEyes, tune in tonight at 8 p.m. ET on Roku and Yahoo News. pic.twitter.com/vUX50JxJP4
— Yahoo News (@YahooNews) January 29, 2019
“The 1 percent must pay their fair share,” she argued.
The congresswoman also pointed to the Defense Department budget as a place from which to reallocate government funding to the new entitlement and green energy programs.
Another proposal Omar advocated for is cancelling student college loan debt.
Salbi wondered how the U.S. government could possibly handle that financially, given the total figure involved is about $1.4 trillion.
“It’s fascinating because we only ask how we’re going to pay for programs that are going to have a positive impact on normal people’s lives and not corporations,” the lawmaker replied. “We recently had a tax cut of $2.2 trillion.”
The Congressional Budget Office reported last April the Republican tax reform law would cost the government $2.3 trillion in revenues over a ten-year period (or $230 billion per year), but economic growth would offset that figure by $461 billion. Other estimates project economic growth will reduce the tax cut costs to the Treasury more than the CBO calculated, according to The Hill.
Omar argued the debt cancellation would pay for itself because more young people would be buying homes and purchasing cars, thereby stimulating economic activity.
“We did (a Republican) tax cut and said it was going to create more jobs, but it didn’t,” she said.
The Bureau of Labor Statistics reported on Friday there were 304,000 jobs added in January, topping economists estimates by 140,000, according to USA Today. Wages also grew by 3.2 percent for the month.
Senior investment strategist Brian Levitt of OppenheimerFunds told Yahoo Finance “wage growth of 3.2 percent is a sign that some of the share of profits are going to labor.”
“Ten years ago we would have been praying for it,” he added.
Over 5 million jobs have been created since Donald Trump was elected president on the promise to cut taxes and government regulations.
The Trump economy so far has added one million more jobs per year than under former President Barack Obama.
In January, claims for unemployment benefits fell to their lowest level in over 49 years, despite the U.S. population being over 120 million more.
Following an economic plan very similar to Trump’s, over 16 million new jobs were created while former President Ronald Reagan was in office (or 2 million per-year), versus the 11.6 million under Obama (1.45 million per year), when there were approximately 80 million more Americans.
Reagan, like Obama, had to overcome a severe economic recession at the beginning of his administration.
Former Reagan administration economist Art Laffer, author of “Trumponomics,” responded to Omar’s plan to tax the wealthy on Fox News on Friday, noting it has never worked in the past.
“What we do know is that every time tax rates have been raised substantially on the rich, not only have we gotten less tax revenues from the rich, but we’ve also caused a recession or decline as a result as well,” he said.
“When we’ve cut taxes on the rich, whether it be (under presidents Warren Harding and Calvin Coolidge in the 1920s), whether it be (John) Kennedy (in the 1960s), whether it be Reagan (in the 1980s), the rich have paid a lot more in taxes,” Laffer added, due to their incomes rising (along with the rest of the working population), as they grew their businesses and created new jobs.
“You can’t love jobs and hate job creators,” the economist said.
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