How High Is Too High?  Diehl, Lindstrom Hit Elizabeth Warren Over Vague Answer On Taxes

Printed from: http://newbostonpost.com/2018/07/28/how-high-is-too-high-diehl-lindstrom-hit-elizabeth-warren-over-vague-answer-on-taxes/

Massachusetts Republican candidate Geoff Diehl taunted incumbent taunted U.S. Senator Elizabeth Warren over how high federal personal income tax rates should be, harping on Warren’s refusal to give a top figure during an interview earlier in the week.

“What’s the number, Senator Warren?  Is it 50 percent?  Is it 60 percent?  Is it 70 percent?  Is it 80 percent?  Is it 90 percent?” Diehl said outside a Warren campaign event in the South End of Boston on Saturday, according to his campaign. “How much do we have to pay in income taxes in Warren’s world?”

“… It is like buying a car.  You want to know the price before you sign on the bottom line.  Before anyone votes, Senator Warren should be upfront with taxpayers and let them know how much of their paychecks she would let them keep,” Diehl said, according to a written statement released by his campaign Saturday.

Another GOP candidate, Beth Lindstrom, hit Warren on taxes earlier in the week.

“Tax reform has stimulated job growth and business expansion in Massachusetts and across America, yet Senator Warren wants to roll back the recently-passed tax cuts and will not rule out a top individual income tax rate of 50%,” Lindstrom said in a written statement. “This is another example of Senator Warren doing everything she can to put the spotlight on herself to win the support of the far left for her campaign for president. The problem is that raising taxes is bad for taxpayers, bad for Massachusetts families and bad for our place in the global economic order. I want to make sure we keep marginal tax rates low for all Americans and that we maintain a corporate tax rate that is competitive with the rest of the world.”

Warren, during an appearance Tuesday, July 24 on CNBC’s Speakeasy With John Harwood, refused to say what the top marginal income tax rate should be, but she sounded nostalgic about the days when the highest-bracket income tax rates were much higher than they are now.

The top marginal income tax rate is currently 37 percent. It applies to the income over $500,000 for single people and over $600,000 for a married couple.

Harwood asked Warren whether she thought 50 percent was too high. She wouldn’t say it was.

“Look, there was a time in a very prosperous America — an America that was growing a middle class, an America in which working families were doing better generation after generation after generation — where the top marginal rate was well above 50 percent,” Warren said.

Harwood noted the top marginal rate was once 90 percent, and he eventually asked Warren whether she is comfortable with that figure.

“No, look. Ninety percent, yes; 90 percent sounds pretty shockingly high,” Warren replied. “But what I’m trying to get at is this is not about negotiating over specific numbers.”

The top federal marginal income tax rate stood at 70 percent or higher between 1936 and 1980, when Ronald Reagan was elected president, according to the Internal Revenue Service. It reached 94 percent in 1944 and 1945, during World War II, and it stood at 91 or 92 percent from 1951 to 1963.

When Reagan left office in 1989, the top rate was 28 percent. It has since increased and fluctuated, but never gotten as high as 40 percent again.

As of 2018, after the Trump tax cut took effect, the federal corporate tax rate is 21 percent. It was previously 35 percent, which is about where it had been since the early 1990s.

Below is a transcript of the back-and-forth between Harwood and Warren on federal tax rates. The transcript was created by CNBC and copyedited by New Boston Post. As of Saturday, July 28, only a portion of the video of the interview is available online.

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John Harwood:  If Democrats take the Congress, if you’re in the White House, or both, would you like to see these corporate tax cuts repealed?

Elizabeth Warren:  Yeah, I really want to see them rolled back.

John Harwood:  Back to 35 percent?

Elizabeth Warren:  Well, it’s not about the number. Here’s how I look at budgets and taxes are at the heart of this. A lot of people think they’re just numbers; they’re not. They are the expression of our values. The values of the Republican Party that passed those tax cuts are to give a trillion and a half dollars away to the richest Americans and the biggest corporations, and let everybody else pick up the crumbs.

And, I don’t think that’s the right way to think about it. I think the right way to think about this is that we need a budget, we need a tax bill that works for all of us. So what I’d like to see is I’d like to see us strengthen America’s middle class.

John Harwood:  What’s too high for the top personal rate?

Elizabeth Warren:  It’s not about a number. That’s what negotiations are all about.

John Harwood:  Is 50 percent obviously too high?

Elizabeth Warren:  That’s why you sit down and you negotiate over the numbers.

John Harwood:  When George W. Bush was president, his team articulated the view that it was a matter of right and wrong that you shouldn’t have more than a third of your income taken. Do you feel similarly that it’s wrong for more than half of somebody’s marginal income to be taken?

Elizabeth Warren: Look, there was a time in a very prosperous America — an America that was growing a middle class, an America in which working families were doing better generation after generation after generation — where the top marginal rate was well above 50 percent.

John Harwood:  It was ninety percent.

Elizabeth Warren:  That’s exactly right. But for me, the heart of the question is that you’ve got to ask, “What constitutes a fair share in this economy?”

John Harwood:  Right.

Elizabeth Warren:  And look. it depends in part on what the economy is. It also depends …

John Harwood:  But it doesn’t strike you as obviously, “No, 90 percent, that’s ridiculous. Can’t be that”?

Elizabeth Warren:  No, look. Ninety percent, yes; 90 percent sounds pretty shockingly high. But what I’m trying to get at is that this is not about negotiating over specific numbers. It’s not about negotiating before you go into the negotiations.

The Republicans wrote this tax bill behind closed doors. They didn’t want any Democrats in the room. They sat down with their donors and with the lobbyists, and they decided on the rates by themselves.

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Diehl, a state representative from Whitman, and Lindstrom, a former Mitt Romney aide and former political consultant, are two of three candidates running for the Republican nomination to take on Warren in the Massachusetts U.S. Senate general election in November. The other one is businessman John Kingston. (A not-for-profit organization affiliated with Kingston owns a modest number of shares in Boston Media Networks, the company that operates New Boston Post.)

Kingston has not as of Saturday issued a public statement on Warren’s CNBC interview, but he implicitly praised the Trump tax cut in a tweet on Wednesday, July 25, saying:

“The numbers speak for themselves:  A strong economy and tax reform are the top two reasons that Massachusetts took in a record-breaking $27.8 billion in additional tax revenue this year. That’s more money in your pockets, and more money that can help MA.”

The primary is Tuesday, September 4.

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