Meet the Radical Economists Behind Warren, Sanders freebeacon.com/politics/meet-…
UC, Berkeley economists Emmanuel Saez and Gabriel Zucman have gained currency on the left for their proposed radical taxes on wealth and financial transactions. While Warren, Sanders, and other liberals rush to embrace them as advisers, a debate has roiled academic economics.
Evidence on which Sanders, Warren, and others have built their plans to dramatically transform the US economy may be shoddier than their supporters realize, according to some prominent Democrats who have called the research "substantially inaccurate and substantially misleading."
Both Warren and Sanders, neither of whom returned requests for comment, have promised to pursue aggressive expansions of government spending, with costs expected to run into the trillions of dollars.
To finance this spending both campaigns have floated novel tax proposals, including Sanders's financial transaction tax and Warren's corporate profit tax. The most ambitious of these, however, is each campaign's wealth tax—a tax levied directly on the assets of the super-wealthy.
Both proposals, according to information released by the campaigns, are the brainchild of Saez and Zucman. The two coauthored letters on behalf of Warren and Sanders touting the plans, and have since made media appearances pushing for increased consideration of a wealth tax.
They also advocated for other policies embraced by both Sanders and Warren, including a recent op-ed claiming that Medicare for All will cut taxes for most Americans—even in spite of Sanders's acknowledgment that tax hikes for the middle class would be needed to pay for his plan.
The dispute over Saez and Zucman's work is intensely technical, but it more or less boils down to the fact that calculating income distribution and tax incidence both necessarily require making a host of methodological choices.
Wherever possible, Saez and Zucman make the choice that in some cases radically overstates inequality compared to other academic estimates.
The wealth tax has become a key plank to Warren's campaign, with supporters chanting "two cents!" at rallies, in reference to the two cents taxed on every dollar over $50 million held.
These supporters probably have not heard from Summers, or Splinter, or any of Saez and Zucman's other critics. Warren may have, but it is clear to whom she chooses to listen.
