Senator Elizabeth Warren is trying to figure out how to pay for her plan to destroy health care in America and forcibly put everyone on a government plan that makes Medicaid look fantastic.
Plan A is to keep telling everyone to think about the “costs”. Plan B could be a 42% sales tax.
The Committee for a Responsible Federal Budget (CRFB) has done voters a favor by spelling out what kinds of new taxes it would take to come up with that much money. Warren justifies many of her programs by saying all it would take is “two cents” from the wealthy. That’s a reference to her 2% wealth tax on ultra-millionaires. But Medicare for All would be so expensive that if you taxed top earners at 100%—that’s right, if you took all the income of couples earning more than $408,000 per year—you’d still fall far short. And everybody getting taxed at 100% would obviously stop working.
Unless you had some sort of reverse slavery while building a wall to keep rich people from escaping by yacht to Australia.
Okay, that won’t do it. So what will? CRFB outlined a variety of options. A 42% national sales tax (known as a valued-added tax) would generate about $3 trillion in revenue. But it would destroy the consumer spending that’s the backbone of the U.S. economy. A tax of that magnitude would be like 42% inflation, wrecking consumer budgets and the many companies that depend on them, from Walmart and Amazon to your local car dealer.
Or, as Bernie Sanders would call that, win-win.
Destroying health care and destroying capitalism in one neat little bundle.
The question is how many Bernie supporters would be okay with a 42% sales tax?
Considering the number of BMWs I’ve seen with Bernie stickers, I suspect all of them. Warren however is trying to combine the Bernie appeal with an appeal to non-Communist BMW owners. So she probably won’t go that route unless she actually gets elected.
Other options include a 32% payroll tax split between employers and workers or a 25% income surtax on everybody. Or, the government could cut 80% of spending on everything but health care, which would include highways, airports and the Pentagon. Or here’s a good one: Just borrow the money and quadruple Washington’s annual deficits.
I think we know which one is gonna to be the winner.