Delaney criticizes Warren’s wealth-tax proposal: ‘Will be fought in court forever’

Former Rep. John Delaney (D-Md.) criticized Sen. Elizabeth Warren (D-Mass.) over her proposed wealth tax during Tuesday’s Democratic presidential debate, in one of many instances throughout the night where the moderate candidates who are struggling in the polls took aim at ideas backed by prominent progressive candidates.

Warren has proposed a 2 percent annual tax on net worth between $50 million and $1 billion, and a 3 percent tax on net worth above $1 billion.

{mosads}Delaney said that he supports raising taxes on the rich by taxing capital gains at the same rates as ordinary income. But he expressed concerns that Warren’s wealth tax would be subject to a lengthy legal battle.

John Delaney on being subject to Sen. Elizabeth Warren’s proposed wealth tax: “I think I should pay more in tax. I think wealthy Americans should pay more in tax, but we have to have a real solution.” https://t.co/oRT2pUk1W4 #DemDebate pic.twitter.com/MWFHw4VAR8

— CNN (@CNN) July 31, 2019

“I think the wealth tax will be fought in court forever,” he said. “It’s arguably unconstitutional, and the countries that have had it have largely abandoned it because it’s impossible to implement.”

Warren did not directly respond to Delaney’s criticism but defended her proposal, saying it could raise revenue to pay for her education and child care proposals.

“I have proposed a wealth tax. It’s now time to do that,” she said. “It’s time to tax the top one tenth of one percent fortunes in this country.”

Delaney responded, reiterating his point that he thinks a wealth tax may be unconstitutional. Warren sought to respond to Delaney’s comments, but the moderators didn’t let her and moved on to another topic.

Some tax experts have questioned weather a wealth tax is unconstitutional because the Constitution states that Congress can impose direct taxes only when they are apportioned by state population, outside of income taxes which are permitted under the 16th Amendment.

When Warren unveiled her wealth-tax proposal, her campaign released letters from law professors arguing that the plan would pass constitutional muster.

The exchange on the wealth-tax proposal was one of several times during the debate when moderate candidates such as Delaney attacked Warren and progressive Sen. Bernie Sanders (I-Vt.) — the two candidates on the stage who have the most support in polls. The moderate candidates also attacked the progressives on issues such as health care and trade.

Rep. Alexandria Ocasio-Cortez (D-N.Y.), a prominent progressive who is not running for president but has become a leading voice of the left, has called for a 70 percent marginal tax rate on income above $10 million, suggesting on Twitter that perhaps the U.S. could adopt more than one change to raise taxes on the rich. 

The point is to stem runaway income inequality, where wealth begins to automatically compound at obscene rates for the extremely rich w/o lifting a finger – often at the cost of low wages. This is a huge driving factor in income & wealth inequality & few want to talk about it.

— Alexandria Ocasio-Cortez (@AOC) July 30, 2019