Professor Rebecca Kysar co-authored a New York Times op-ed that examines the wealth tax proposals made by Elizabeth Warren and Bernie Sanders.
Senator Elizabeth Warren unveiled a new wealth tax proposal last week that she says will raise — along with her previously announced wealth tax plan — $3.75 trillion over the next decade. Senator Bernie Sanders says his wealth tax will yield $4.35 trillion over the same period.
We fear these figures are vast overestimates. The likeliest outcome is that a wealth tax will raise exactly zero dollars. The problem, alas, is the Constitution.
Wealth tax proponents might argue that progressives ought not trim their sails simply because they fear that hostile justices will strike down their policies. Certainly, it would have been bad advice to tell President Franklin Roosevelt not to pursue the New Deal because a conservative court would fight back. But this is not an instance of ideologically motivated jurists pulling a rabbit out of a hat. A good-faith reading of history and precedent would suggest that the Warren and Sanders wealth taxes are unconstitutional.
But a wealth tax that is struck down by the justices will do nothing to close the wealth gap. It will raise no money to pay for universal health care and child care, greater investments in education or ambitious efforts to halt global warming. It will, instead, mire the country and the courts in yearslong litigation. And it will most likely lead to a Supreme Court ruling that sends us back to square one in our fight to fix a tax system that all too often favors the rich.