Elizabeth Warren and Bernie Sanders are playing "Dueling Banjos" in the race to present their greatest Tax Hike Hits to the American public.
These ideas threaten not only our income but all of our retirement savings. Our future retirement security is in danger and too many people do not know it.
A review of their tax tunes turns up these false notes:
Bernie Sanders' tax is called Inclusive Prosperity. Warren dubs hers Accountable Capitalism. They are joined by Kamala Harris who also wants to include a tax on every stock, bond, and derivative transaction.
The Financial Transaction Tax is a range of 0.5% to 0.2% tax on stocks, 0.2% of bonds and 0.005% tax on derivatives.
According to research by Georgetown University finance professor, James Angel, this is a direct tax burden on ordinary investors because financial intermediaries would simply raise fees on every mutual fund, 401(k), IRA and pension portfolio. An Average IRA could have up to $20,000 less at retirement time.
Democratic front runner Elizabeth Warren presents a range of unappetizing concoctions in her recipe for Empowering Workers through Accountable Capitalism.
She trumpets an effort to redefine and broaden corporate accountability. But she is not interested in increasing shareholder value. The typical U.S. Corporation with revenues over $1 billion a year would be obligated to reconfigure its Board of Directors in a shift away from representing shareholders. An odd swipe at the current Employee Retirement Income Security Act of 1974 (ERISA).
This federal law sets minimum standards for most retirement plans in private industry to provide protection and maximization of long term returns for individuals enrolled in these obligations.
Elizabeth Warren’s vision of ‘accountable capitalism’ would destroy a huge sum of savings built over a lifetime — and sink the economy, writes former Texas Senator Phil Gramm and economist Mike Solon.
Our U.S. stock market is now almost $34 trillion, compared to the rest of the world markets which total over $44 trillion in capitalization.
American companies have been allowed to thrive and grow to impressive proportions.
Over 50% of U.S. equities are owned by retirement funds. U.S. retirement assets reached $29.8 trillion in June 2019 and now account for 33% of all American household financial assets.
Warren's Social Security Plan aspires to increase current and future beneficiaries' benefits by $200 a month. This idea would cost more than $150 billion annually. It would be fueled by a 14.8% tax on investment income of taxpayers earning more than $250,000 and married couples earning over $400,000. There would also be an increase in payroll taxes for both employers and higher earning employees.
This proposal is completely lopsided in that it benefits both high- and low-income senior citizens alike. That defeats her agenda to help the impoverished senior.
Her wealth tax aims at the “richest 0.1 percent of American households.” However, this tax could impact Middle America because wealth is invested not simply in homes and financial markets but in a range of businesses, commercial ventures, and innovations which lead to job creation.
Warren’s proposal procession has provoked public reaction from longtime Democratic donors on Wall Street and the business community.
Supporting her would "be like shutting down our industry,” an executive at one of the nation’s largest banks told CNBC recently.
A report from liberal group Public Citizen argues that most families have nothing to fear from new financial transaction taxes and more because only half of us have retirement accounts.
These taxes bypass the middle class and "surgically target resources being tied up by the wealthiest Americans to be repurposed for better uses."
Sadly, this brings to mind a paraphrase of the memorable Greta Garbo quote from the classic 1939 film "Ninotchka": The mass taxes have been a great success, there are going to be fewer wealthy but better Americans!
Clara Del Villar is Director of Senior Initiatives at FreedomWorks Foundation. Her financial industry career included senior roles in Investment Management, Private Asset Management, and Capital Markets. Her entrepreneurial ventures involved digital media as Founder, CEO of The Hispanic Post; energy tech as founder of InEnergy and health tech. She is a former advisor at 60Plus Foundation. Currently, she is a Board Director at General American Investors Co. and Executive Committee of Weill Cornell Women’s Health Symposium. She earned a BSFS at Georgetown University. To read more of her reports — Click Here Now.
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