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Annie, The Atlantic, “A Promise So Big, Democrats Aren’t Sure How to Keep It,” May 11, 2018 dmr

There is also the cost. “It would take a level of funding for which we would have to very much alter our fiscal outlook,” Jared Bernstein, who was former Vice President Joe Biden’s chief economist and is now at CBPP, told me. Small pilot programs aimed at stopping recidivism might pay for themselves. But a true jobs guarantee would cost something like $400 to $700 billion a year now, and vastly more during a downturn. There are other sticky questions. How much should these jobs pay, and what kind of benefits should they provide? Would a jobs guarantee foment inflation? What would a jobs guarantee do to our understanding of the interplay between inflation, employment, and growth anyway? Would the government get rid of unemployment insurance? Would the jobs be permanent? If not, is that really a guarantee that ends joblessness, once and for all? If so, would that sap the country of some of the ingenuity of its private workforce? What share of the economy would be involved in care work? How much would that represent a movement from uncompensated, kitchen-table care work to compensated, workplace care work? For some Democratic policy wonks, the trade-offs in both economic and political capital seem the most salient. What do you give up by implementing a jobs guarantee? What comes first: a public option for health insurance, or a major jobs plan, or an expansion of the Earned Income Tax Credit, or a universal child allowance, or a major educational debt-relief plan, or postal banking—all of which are ideas being pushed by Democratic presidential aspirants right now? “How much in life do you spend money on the last mile?” Gene Sperling, who was the director of the National Economic Council under Obama, asked me. “There are big, long-term unemployment problems, right? That’s complicated. Those are people who need a lot of help. They need a lot of support. Is that really the issue, or is the issue that the working poor are not making enough money to support their families? If you’re going to spend a trillion dollars on something huge …There’s an element here of people not thinking about what they’re actually trying to do.” In a technocratic sense, perhaps. But the technocratic problems that a jobs guarantee poses are not impossible to solve. There are good models. RecycleForce, for instance, cuts the recidivism rate of recently incarcerated individuals to 26 percent, versus a national rate of 64 percent, Keesling told me. And it saves the taxpayer $1.20 for every dollar invested. Surveys show that similar jobs programs have raised both earnings and employment rates for their participants, and also “decreased family public benefit receipt, raised school outcomes among the children of workers, boosted workers’ school completion, lowered criminal-justice system involvement among both workers and their children, improved psychological well-being, and reduced longer-term poverty,” a survey by the Georgetown Law Center on Poverty and Inequality found. “There may be additional positive effects, such as increased child-support payments and improved health.” Scaling up transitional jobs initiatives would be a good start, then. “There’s nothing resembling an entitlement that supports a person coming home from prison right now,” Sam Schaeffer, the executive director of the Center for Employment Opportunities, a New York-based nonprofit that provides jobs and training to the formerly incarcerated in 20 cities, told me. “To really tackle this challenge, there should be some unifying mechanism, with a mix of workforce programs, anti-poverty programs, nutrition assistance, housing, and more. We’ll pay $82 billion a year to incarcerate people. We don’t make anything like a similar investment on reentry.” There are also models stemming from TANF-EF. JobsNOW! in San Francisco offers a tiered program to help workers with different levels of readiness for a paid job. One tier pays participants while they enroll in job-readiness or vocational training, or a high-school diploma program. It also pays participants to do relatively low-skill work at a nonprofit. Finally, there is a wage-subsidy program, aimed at individuals with work experience. On top of that, the program provides case management and wraparound services, helping ensure that participants have Medicaid and food stamps. All in all, it has increased its 20,000 participants’ earnings by an average of 55 percent, and three in four no longer need cash assistance two-and-a-half years after exiting the program. The evidence for what works is out there, and the need especially great in certain communities and with certain individuals. Starting with pilots and scaling them up, as Booker wants to do, makes sense. So does Khanna’s model of directing state and local governments to figure out what works for them, as TANF-EF did. So does Sanders’s idea of having “hundreds” of public-works initiatives. For all the blue-sky thinking and talk of a national, public-jobs guarantee, Democratic policymakers do seem to be taking the idea seriously, but not literally, to borrow a phrase. The idea is to indicate to the country that they want to tackle the biggest challenges with the biggest solutions—not to figure out every detail, pay for every dollar, appeal to every voter, and pass a policy bar their colleagues on the other side of the aisle have shown no interest in. That gives Democrats room to experiment. “This is not a panacea to solve the jobs problem. It has to be attacked in multiple ways,” Khanna told me. “I would argue that this is a first, serious proposal that by my own admission I would say is not intended to be perfect.” It avoids putting them in the position of negotiating themselves down. “I see it as really opening the Overton Window in a way that is a quite useful for this debate,” Bernstein said. “I’m not in the business of negotiating with myself at this point. Let’s let all the good ideas blossom.” It vaults over the need to figure out the most difficult parts of the legislation, like how much or how to pay for such a proposal. “I’m not gonna presume how we pay for it,” Tanden said. “I do think the Republican tax plan indicates how little Republicans care about deficits when it comes to taxes. I’m not saying that we won’t care about this. But obviously it makes that an easier conversation.” It also acknowledges that Republicans are unlikely to get on board with big Democratic ideas, freeing liberals to think bigger. “We live in the era of tribalism,” Tanden told me. “It’s hard to think through a proposal if Republicans feel like doing any deal with Democrats is noxious. Ipso facto, when a Democrat proposes something, they cannot support it because it’s the Democrats have creating it. That does not allow for compromise.”

(CNN) — Though a group of Democratic lawmakers and progressive advocates pushed hard to partially restore an enhancement to the child tax credit, the measure did not make it into the $1.7 trillion federal spending package.

The coalition’s priority was to increase the refundability of the credit so more of the lowest-income families could qualify, as they did last year thanks to the Democrats’ $1.9 trillion American Rescue Plan’s temporary expansion of the credit.

A narrow majority of U.S. adults (54%) say they would oppose the federal government providing a guaranteed income – sometimes called a universal basic income (UBI) – of about $1,000 per month for all adult citizens, whether or not they work; 45% favor the proposal.

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Republicans have claimed over and over again that they are not trying to cut Social Security and Medicare. Heck, Joe Biden got them to agree they would not make cuts to the programs, in a memorable verbal maneuver during his State of the Union speech earlier this year.

And yet the Republican Study Committee (of which some three-quarters of House Republicans are members ) just released its desired 2024 budget ,in which the party seeks to, you guessed it, cut Social Security and Medicare.

Megan, The Washington Post, “Universal Basic Income Has Been Tested Repeatedly. It Works. Will America Ever Embrace It?,” October 24, 2022 https://www.washingtonpost.com/magazine/2022/10/24/universal-basic-income/dmr

Now, though, as the country emerges from the pandemic, the guaranteed income movement sits at a crossroads. The pilot programs have created scores of stories like Everett’s about how a small amount of money led to massive change in a recipient’s life. And a growing body of research based on the experiments shows that guaranteed income works — that it pulls people out of poverty, improves health outcomes, and makes it easier for people to find jobs and take care of their children. If empirical evidence ruled the world, guaranteed income would be available to every poor person in America, and many of those people would no longer be poor.

But Basic Income doesn’t have a natural fit in either party’s platform. Republicans like Paul Ryan favor highly-targeted programs to low-income people. The most favored of these programs encourage work: think the Earned Income Tax Credit and limited time on welfare payrolls. And while Republicans are more in favor of in-kind or cash-transfer programs (for instance, they approve of vouchers and Pell Grants), they usually aren’t pushing for low-income relief (something Speaker Paul Ryan says he wants to change). Democrats, meanwhile, are wary of cash transfer programs, and favor governmental and institutional expansion. Examples of this would be universal public pre-K, free college, and universal healthcare. When Democrats do approve of in-kind programs, they tend to be parochial by restricting how the money can be spent: think food stamps. Plus, many Democrats also believe in the inherent value of work, and so focus on efforts to improve the workplace through increasing the minimum wage and worker protections and benefits. That puts Basic Income—a universal, and unrestricted cash transfer program—in an awkward position in our current policy environment. But as the parties realign, Basic Income may find a champion with the new corporatist, quasi-libertarian Democrats, while being vilified by the populist Republicans. If you believe there is a coming realignment, then the future of the Democratic party is big business, and big business, especially the technology sector, will love Basic Income. The tech sector likes minimal government regulation, which has allowed them to gain monopoly power, amass giant profits, and control and manipulate entire areas of the economy. These companies are very opposed to heavy-handed market interventions such as breaking those companies up (Google, Amazon) or heavily regulating what it means to be an employee (Uber). The tech companies will argue that they are efficient and keep prices low for consumers, and that heavy regulation will hamper innovation. With Basic Income, these companies don't have to change their behavior, but everyone would become more economically secure. Uber employees will be financially secure, even if they don't get paid much, and are automated away later by driverless cars (the same logic explains why Travis Kalanick, CEO of Uber, supported Obamacare). No company wants to pay higher taxes, but they would trade higher taxes to fund Basic Income if it allows them to continue to dominate the market. Greg Ferenstein, who used to write for TechCrunch and has studied the political views of Silicon Valley elites said in a recent interview, “It is absolutely false to consider Silicon Valley anti-tax. They are not anti-tax, and they are not anti-redistribution. They are generally anti-regulation, but they are pro anything that uses their wealth to help the common good in way that doesn't inhibit economic disruption and innovation.” Marginally higher taxes are not an existential threat. Market controls are. And besides, these companies, often funded by ad dollars, understand that money needs to continue to circulate in the economy in order for consumers to keep buying things, which thus justify the business model of many of the tech companies' services. And while it's especially true in the technology sector, the leaders and workers of large U.S. companies are increasingly coastal, cosmopolitan elites, which means the values of their companies will reflect their own values. Those values are not only socially liberal, but that the government should help people efficiently and with limited bureaucratic interference. Cosmopolitan elites will also like how Basic Income helps prevent the proletariat from revolting without too many invasive policy solutions. Urban poor will like Basic Income because it will increase their incomes, and also frees them from demeaning parochial meddling of administrators telling them how they can and cannot spend their money (i.e., food stamps). To be sure, many Democrats will oppose Basic Income. They will argue that it will dismantle parts of the social welfare state (which it will). These Social Democrats will be wary that Basic Income will replace various safety nets. But with big business and urban elites in favor of the idea, there's a good chance the Democratic Party will come to embrace Basic Income.

Another reason for comparing basic income and working-hours regulation is that such a contrast contributes to the discussion about policy choice under political and, specifically, democratic constraints. Much—especially academic—discussion about policy is overly philosophical, focusing on fundamental normative principles. But many non-normative constraints also influence what policies are possible—not just desirable. These include political institutions, political capital, path dependencies, and institutional complementarities, to name but a few. For example, as a large political literature suggests, how countries regulate financial markets depends a lot on how they regulate labor markets. Therefore, however much we may find a piece of financial regulation normatively attractive, implementing that regulation may depend—positively—on the nature of surrounding rules, institutions, and interests. 27

Basic income and working-time regulation gives us a good example of this problem. On an abstract philosophical level, these policies are not necessarily substitutes. That is, there is no particular normative reason why a country could not have both basic income and stricter regulation of working time. Indeed, there are some authors who have argued precisely for both. Nevertheless, real-world, 28 existing constraints—limits in political capital, political feasibility, path dependency, etc.—may make such a choice necessary. In particular, basic income represents a quite novel, “disruptive” and “post-industrial” approach to welfare reform. Working-time regulation—which in some fashion already exists in every developed country—is far more consistent with welfare-state policy as it currently exists. Consequently, basic income may generate substantial tensions with the existing institutional environment of mature welfare states. To the extent that this is true—and makes each policy institutional if not normative substitutes—this Article offers some reasons for why working-time regulation can be preferred to basic income. Furthermore, this Article should not be read as a rejection of basic income as a policy proposal by itself. As will be seen, there is much to be said in favor of basic income. Nevertheless, the choice becomes relevant and compelling in light of both the possibility of institutional constraints and the fact that basic income and working-hours regulation address similar normative objectives across a number of dimensions.

Republicans, who are demanding deep spending cuts in exchange for raising the nation’s borrowing cap, will almost certainly greet that proposal with a familiar refrain: Mr. Biden and his party are to blame for ballooning the debt.

Republicans have argued that steep spending cuts are necessary to curb the growth of the national debt, which at $31.4 trillion is roughly equal to the annual output of the economy.

Reducing the budget deficit is a higher priority for the public than it was last year. The share of the public saying that reducing the budget deficit should be a top priority for the president and Congress this year has increased by 12 points since 2022, according to a January 2023 Center survey. Today, 57% say that reducing the budget deficit should be a top priority, compared with 45% in 2022. Both Republicans and Democrats are more likely now than in 2022 to say this should be a top priority, but Republicans are still much more likely to prioritize this than Democrats are (71% vs. 44%).

President Biden plans to make deficit reduction a centerpiece of his 2024 budget and aims to pressure Republicans to focus on government revenue — not just spending, Axios has learned. Why it matters: The White House is seeking a tactical advantage in its looming showdown with congressional Republicans on the debt limit — and wants to test Republicans' commitment to lowering annual deficits over the next decade. Officials plan to dust off a variety of proposed tax increases on corporations and wealthy Americans — including Biden’s plan to boost rates on billionaires — to narrow the gap between what the government takes in and spends. Biden's budget will claim some $238 billion of deficit reduction from the Inflation Reduction Act. It's unclear whether it will count the potential $400 billion cost of his student loan forgiveness plan, which is tied up in the courts. Biden also is preparing to achieve his goal by slowing the rate of some spending. Republicans have called for cuts without specifying which ones. He hinted at his strategy in his State of the Union address: “The plan I’m going to show you is going to cut the deficit by another $2 trillion." Driving the news: Biden plans to submit his budget on March 9. Congress is supposed to pass a budget resolution by April 15, but routinely blows past that deadline. His ambitions on deficit reduction are complicated by rising interest rates. They'll force the Treasury Department to spend more servicing the federal debt, now above the $31.4 trillion debt ceiling. Officials also face the prospect that slowing economic growth will provide the treasury with less revenue. Flashback: Last year, with inflation surging and Sen. Joe Manchin (D-W.Va.) harping about deficit spending, Biden’s budget focused on boosting revenue. This year's budget will take a similar tack, but with bigger goals. “This president takes a backseat to nobody on deficit reduction," Shalanda Young, director of the Office of Management and Budget, said on "Morning Joe" last week. "The budget will continue the trajectory on reduction.” The big picture: The White House — and most of Washington — is preparing for a massive debate about the national debt. Both sides want to position themselves as a prudent steward of the country’s finances. Biden has been accusing Republicans of scheming to gut Medicare and Social Security. In his State of the Union address, he goaded them into standing for his call to protect those programs from any cuts. Republican leaders insist that changes to Medicare and Social Security — an idea that has been suggested by a few Republicans — are not being discussed now, and that Biden’s claims to the contrary are not made in good faith. By the numbers: Biden proposed a total of $5.8 trillion in spending in his fiscal 2023 budget, with a deficit of $1.2 trillion for the year. In last year's budget, he proposed spending $14.4 trillion more than the government planned to collect in revenue over 10 years. That pace of spending would bring the total debt to $44.8 trillion at the end of 2032. Interest payments on that debt would climb to $1.2 trillion a year by 2032, amounting to 3.3% of the projected GDP, according to the Congressional Budget Office. Between the lines: Biden and his team want credit for reducing deficit spending in 2022 compared to 2021 and 2020, President Trump’s last year in office.

“The Deficit Myth: Modern Monetary Theory and the Birth of a People’s Economy,” Kindle Edition (accessed 4/26/2023)

Of course voters are terrified! How could they not be? Unless you manage to steer clear of all political discourse, it’s virtually impossible to get through the workweek without encountering some form of hysteria over fiscal deficits and the national debt. Newspaper headlines scream of record indebtedness and looming disaster. A debt clock towers over pedestrians on West 43rd Street in New York City, delivering the daunting numbers in real time. Political cartoonists depict the federal debt as a hungry T-Rex eating its way through city streets or as an ever-expanding balloon on the verge of exploding. Bookstores are replete with bombastic titles featuring anxiety-inspiring words like Endgame, Red Ink, and Fiscal Therapy. Social media circulates breaking news alerts to report the latest dire projections from the Congressional Budget Office. Talk radio plays alarming audio of former secretary of state Hillary Clinton warning that “our rising debt levels pose a national security threat.” Even ordinary citizens, like the one who put the sticker of a broke Uncle Sam on the bumper of her SUV, have become messengers of doom. It’s a wonder we’re not all holed up in a bunker, bracing for Armageddon. The end is always near.

“The Deficit Myth: Modern Monetary Theory and the Birth of a People’s Economy,” Kindle Edition (accessed 4/26/2023)

The truth is, we’re fine. The debt clock on West 43rd Street simply displays a historical record of how many dollars the federal government has added to people’s pockets without subtracting (taxing) them away. Those dollars are being saved in the form of US Treasuries. If you’re lucky enough to own some, congratulations! They’re part of your wealth. While others may refer to it as a debt clock, it’s really a US dollar savings clock. But you won’t hear that from anyone in Congress. You can imagine why. Think about what would happen if a member of Congress returned to his or her district and tried to convince a roomful of panicked constituents that everything they deeply fear about our ballooning national debt is really a big nothing burger. With every other voice of authority delivering exactly the opposite message, the words of the soothsayer would go over like a lead balloon. Sometimes, as Mark Twain put it, “it’s easier to fool people than to convince them that they have been fooled.”

“The Deficit Myth: Modern Monetary Theory and the Birth of a People’s Economy,” Kindle Edition (accessed 4/26/2023)

Why didn’t we make better policy? You might think the answer is that our two-party system has become so divided that Congress was just incapable of doing the right thing, even when confronted with a national calamity that threatened the security of average Americans and big corporations alike. And there is certainly some truth to that. In 2010, Senate majority leader Mitch McConnell boasted openly that “the single most important thing we want to achieve is for President Obama to be a one-term president.” But party politics weren’t the only obstacle. The politics of deficit hysteria, embraced by both sides for decades, served as an even bigger impediment. Bigger deficits would have enabled a faster and stronger recovery, protecting millions of families and avoiding trillions in economic losses. But no one with any real power fought for bigger deficits. Not President Obama, not most of his senior advisers, not even the most progressive members of the House and Senate. Why? Did everyone really believe that the government had run out of money? Or were they just afraid of offending the sensibilities of voters like the one who placed that bumper sticker on her Mercedes? We can’t use deficits to solve problems if we continue to think of the deficit itself as a problem. Right now, about half of Americans (48 percent) say that reducing federal budget deficits should be a top priority for the president and Congress. This book aims to drive the number of people who believe the deficit is a problem closer to zero. It won’t be easy. To get there, we’re going to have to carefully unravel the myths and misunderstandings that have shaped our public discourse.

Perhaps the biggest political obstacle to the introduction of a one-off wealth tax is the fact that it is politically costly, yet some of the fiscal benefits that it generates will redound to the credit of future governments – assuming annual payments extend across at least one electoral cycle, and/or the funds are used to pay down debts. Why expend political capital in the pursuit of additional revenue (or lower debt levels) for one's successors? Yet the same objection could be levelled against any significant revenue-raising measure.22 The time-bound nature of a one-off wealth tax means that revenues are likely to fall primarily to the tax-introducing government, depending on the timing of the tax and the length of the electoral cycle, as well as on factors such as inflation and any interest charges applied to tax liabilities paid by instalment.

Ronald Reagan famously said of the government’s view about the economy, “If it moves, tax it.” Along with several other liberal Democrats in Congress, this week Massachusetts Senator Elizabeth Warren resurrected a wealth tax proposal. Called the “Ultra-Millionaire Tax”, the scheme would impose a 2 percent annual tax on the net worth of households and trusts between $50 million and $1 billion and a 1 percent yearly surtax (3 percent tax overall) on the net worth of households and trusts above $1 billion. Warren featured the idea during her 2020 presidential run, and we know how that turned out. The Senator’s press release featured all the usual utterances about rich people paying their “fair share” (a phrase that appears eight times in the release) and ticking off all the wondrous federal programs the booty would cover, such as infrastructure, child care, education, and so on. Warren claimed necessity for the legislation because “the ultra-rich and powerful have rigged the rules in their favor so much”. But passing the buck is something many members of Congress do better than anything else. The ultra-rich didn’t “rig the rules.” Congress created the tax laws, and any “rigging” is merely people with means of hiring accountants or attorneys to work within the rules to reduce their tax liability. In addition to the initial levy, the bill features an eye-watering “exit tax” of 40 percent levied against anyone with a net worth of over $50 million who decides they want to renounce their citizenship and jettison away to the Cayman Islands to relieve the tax burden. Any attempts to enforce the penalty will undoubtedly face legal challenges that will stretch on for years. Liberals are fond of pointing to Europe as models of success for government action. However, Warren and Bernie Sanders, another wealth tax proponent, aren’t holding up nations across the pond as beacons of enlightenment on this issue because most of them flopped. Twelve European countries had wealth taxes in 1990. That number now stands at just four. Critics of the European models point to their design, saying the failures came about as the result of allowing too many exemptions for various asset classes, undercutting their ability to draw in revenue. Warren’s plan has no exemptions, so easy peasy, right? Not exactly. When a person reads an article highlighting Jeff Bezos’s net worth, it typically presents an immensely rough estimate calculated by multiplying his shares owned in Amazon by their current share price. But Bezos has other investments. He also owns real estate, antiques, art and has other assets that contribute to his wealth. How does Warren expect to calculate it every year? For example, in 2019, Bezos paid $52.5 million at a Christie’s auction for Ed Ruscha’sHurting the Word Radio #2. Since Warren’s plan has no exemptions for art, who will determine the value of that painting every year to account for the tax the well-known billionaire will pay? The Internal Revenue Service? Once you start to think about it, things get complicated — almost impossibly complicated. The enforcement issues exist outside the possible Constitutional hurdles the plan must overcome. The Constitution forbids the federal government from implementing direct taxes except for the federal income tax allowed via the 16th Amendment. States collect property taxes and sales taxes. There is no authority for the federal government to look at Bezos’s paintings, antiques, his yacht (assuming he has one), properties, and other physical assets and say, “Pay us.” Finally, the political battle won’t be an easy one. The public has a favorable view of the wealth tax, as is the case with most “soak the rich” initiatives. President Biden, however, is not necessarily on board. When asked about it, press secretary Jen Psaki managed to regurgitate the “fair share” piffle but wouldn’t go much further. The Democratic Congressional majority is so slim, Biden likely won’t invest a boatload of political capital pushing for a bill that will face legal challenges the moment he signs it. That said, it also shows how much the party’s left wing is attempting to pull Biden in their direction. Hidden in the back, helping them out, is the Republican Party, happy to make it easier for them to win back control of Congress in 2022.

Jonathan, New York Magazine, “Biden Wants to Tax Billionaires Because U.S. Politics Is Still a Class War Democrats and Republicans are mostly divided over redistribution,” March 29, 2022 dmr

If you look at the total redistributive effect of the tax code, it is quite modest: The point is that Republicans without exception believe that this slim level of redistribution nonetheless punishes the rich too heavily. Since the New Deal, the Democratic Party has been organized around greater levels of economic redistribution and the Republican Party around lesser levels. Following the Reagan era, the Republican position radicalized — since 1990, an era when Republican rhetoric has routinely presented the deficit as a first-order social crisis, there have been zero Republican votes at the federal level for even a penny of higher taxes on the rich. Meanwhile, every Democratic presidency has devoted substantial political capital to raising taxes on the rich. Biden hasn’t succeeded yet, a failure attributable to the narrowness of his congressional majority. Joe Manchin opposes Biden’s plan to tax unrealized billionaire capital gains but favors other plans to tax the rich. At least some increase in tax on the rich seems likely to pass on a party-line vote. There are several reasons why the tightly drawn class warfare between the two parties tends to recede into the background of the political debate. It is familiar and long-standing, i.e., not new. The media is more drawn to social-issue controversies than economic-policy fights. Conservatives are strategic about changing the subject away from economic-policy fights in which their party has an unpopular stance, while progressives are not strategic enough to focus on them. And the Trump era has made it especially fashionable for analysts across the spectrum to conceptualize Republicans as the proletarian party, an idea that substitutes a focus on the party’s voters for one on its policy agenda. But the banal fact remains that redistribution in general, and taxing the rich in particular, remains the primary ground the two parties are fighting over on a daily basis. The best thing Biden can do for himself is to remind people of this.

WASHINGTON DC - President Biden is expected to once again propose a wealth tax during his State of the Union, even after the idea failed to gain traction when Democrats controlled both houses of Congress. But even if the so-called wealth tax fails on the federal, lawmakers in several states have introduced similar bills on the local level, including one in California. "The average effective taxation rate for billionaires is eight percent. That's far below the rate for average middle and working class families across the country. And in California, it's the same way," says Assemblymember Alex Lee (D) San Jose. Assemblymember Lee says under his bill there would be an one-percent tax on assets over $50-million. Assets in excess of a billion dollars would be taxed at 1.5%. "99.9% of people in this country are not very, very rich. And they are shouldering the tax burden now. And they want to see those who have an insane amount of money pay what they owe," he said. But critics say there are philosophical and practical concerns. "To add on a new tax would actually physically motivate people who earn this much money to just move out of the state," says former San Jose City Councilman and businessman Johnny Khamis. Assemblymember Lee says the notion that billionaires will be simply sidestep the law and leave the state is overblown. "Study after study have shown us that it's really middle and lower-class people who move out of states that are high cost because it is high cost. Those who can pay the premium end up staying," Lee said. It's not clear if President Biden has the political capital to get his wealth-tax proposal through a divided Congress. But Khamis says there's only two ways to balance a budget and he wishes there was less emphasis on taxation. "There's two sides to the equation -- there's the taxing and the spending. We keep focusing on taxing. And we never look -- neither Republican or Democratic administrations want to do the hard work or looking at our spending," Khamis said.

With interest rates for government borrowing still near zero percent, and the strong track record infrastructure spending has as an “investment multiplier,” financing an infrastructure package is smart and relatively risk-free, said Bilmes. Raising capital gains and income taxes would create a protracted battle on Capitol Hill that would eat up valuable time and political capital for the Biden administration.

While hiking gas and carbon taxes “should be” part of the plan’s financing equation, she said, those moves are highly unlikely since Congress hasn’t raised the federal gas tax since 1993 because of its broad unpopularity.

“Biden raising taxes would be ‘risky political move’: Former Clinton adviser,” Fox Business, https://www.foxbusiness.com/money/biden-raising-taxes-risky-clinton-adviser

“You’re in the middle of a pandemic, in which the leading economic spokespeople for the administration just said that we have a long way for recovery. So obviously a big tax increase is not a formula for economic recovery. So it's a risky political move to do a tax increase...until the economy is on a stable and strong footing. Right now, the administration started out with a decent honeymoon -- the public likes Joe Biden. I think they're waiting to really see more of him in the upcoming press conference that's been long delayed. I think that the administration should perhaps tread carefully here. The stimulus bill got passed -- almost 2 trillion -- but they're going to try to put 2 to 4 trillion, the largest tax increase in history. The Democratic moderates may not go along with it. The border is raging; there's an embarrassing China meeting...this could be a short-lived honeymoon unless the administration slows down a bit, and accumulates political capital here.