Home Depot co-founder Ken Langone ripped into the Biden tax plan on Wednesday when he said that it was a “fraud” to suggest that middle-class Americans won’t have their taxes raised if Joe Biden is elected President.
“First of all there’s a reality, you aren’t going to get the revenue numbers by just taxing the rich,” Langone told Fox Business.
“The only way a tax increase will generate revenues is to go after the middle class. That’s where the numbers are. These people are being misled,” he explained. “It’s absolutely a fraud to suggest that the money that’s going to be needed is going to come from the rich or the super-rich.”
Langone would add that the problem with going after the middle class with tax hikes is “you go after the backbone of the economy” and “we will have a bad recession” as a result.
The Home Depot co-founder believes that the Biden team is well aware that the idea of generating enough revenue through taxing the rich will not work and that lower and middle-class Americans will find this out “when its too late.”
Biden’s $4 trillion tax, to be implemented over the next ten years, was described as “the highest in American history – indeed, in world history” by Lew Uhler, chairman of the National Tax Limitation Committee, and Peter Ferrara a senior policy adviser to NTLF in their analysis published in The Hill.
The analysis showed that Biden’s plan would raise taxes on middle-class families by over $2,000 a year, with a $1,300 annual tax increase on a median-income, single parent with one child.
It also showed that the plan would double the current capital gains tax, pushing it towards 40% while increasing the death tax.
Separately, an analysis done by the D.C.-based Tax Foundation concluded that the Biden plan would reduce GDP by 1.47 percent over the long term.
[ZH: In fact, as The WSJ Editorial Board wrote last week, the issue is whether Mr. Biden’s policies will nurture this strong recovery, or slow it down as Barack Obama’s policies did after the 2009 recession.
This is where the Hoover study comes in, as it examines the Democrat’s proposals on health insurance, taxes, energy and regulation.
Overall, the authors estimate that the Biden agenda, if fully implemented, would reduce full-time equivalent employment per person by about 3%, the capital stock per person by some 15%, and real GDP per capita by more than 8%.
Compared to Congressional Budget Office estimates for these variables in 2030, this means there would be 4.9 million fewer working Americans, $2.6 trillion less in GDP, and $6,500 less in median household income.
The authors reach three key conclusions:
First, transportation and electricity will require a lot more inputs (including 1.3 million net additional energy workers) to produce the same outputs because of Biden’s ambitious plans to further cut the nation’s carbon emissions. Because these industries are a nontrivial share of the overall economy, that means 1 or 2 percent less total factor productivity overall. These effects would be significantly larger —likely dwarfing the (nontrivial) rest of the agenda—if the energy goals are taken literally. The costs would also be concentrated geographically.
Second, labor wedges (the amount of the value created by additional work that goes to third parties) are increased by proposed changes to regulation as well as to the Affordable Care Act (ACA). The quantitative findings for the ACA should be no surprise given the findings from previous efforts in the United States and other countries to expand health insurance coverage.
Third, Biden’s agenda reduces capital intensity by increasing average marginal tax rates on capital.
There is much more in the Hoover study, especially on the costs of returning to Obama-style regulation. Most of the media will ignore it, which is why we thought we’d provide readers with the full study.
President Trump on Wednesday said that Biden “will destroy our economy” with his plan to raise taxes.
Remember, BIDEN is going to raise your taxes at a level never seen before. This will not only be very costly for you, it will destroy our economy, which is coming back very rapidly.
— Donald J. Trump (@realDonaldTrump) October 21, 2020
We suspect he is right.