The Case for Taxes: What Obama Can Learn from Elizabeth Warren

[youtube]http://www.youtube.com/watch?v=htX2usfqMEs&feature=player_embedded

Elizabeth Warren just announced she is running for Senate, and already she has given the clearest pitch for taxing the rich we've seen in awhile. All other Democrats should be required to sit down and watch this video. She gets it, and they don't.

Obama, in a speech rolling out his new plan to tax millionaires, claimed a tax hike for the rich "isn't class warfare, it's math." Democrats decry the wealth gap, but usually stop short of citing the numbers. This works for the already converted, but all conservatives hear is that every rich person owns a jet, he got where he is by sitting on his ass, and he doesn't deserve to keep his money. Plus, they counter, it wouldn't even work.

Elizabeth Warren's explanation sidesteps these problems:

You built a factory out there? Good for you. But I want to be clear: you moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

Now look, you built a factory and it turned into something terrific, or a great idea? God bless. Keep a big hunk of it. But part of the underlying social contract is you take a hunk of that and pay forward for the next kid who comes along.

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Not only that, she assigns a number—one trillion dollars—to the Bush-era tax cuts, something Democrats rarely have the guts to do. This is the most effective way of explaining to mainstream Americans that millionaires and corporations should be taxed. Warren makes it crystal clear that she believes in capitalism. Her argument is that every American is invested in that rich person, and they should get a return on their investment. Their tax money has paid for the education of the rich person's workforce, for their roads and their law enforcement. If we want capitalism and opportunity and entrepreneurship to work, the lucky ones should encourage it by fostering an environment ripe for the next person to succeed. Warren gives the rich a nice pat on the back—"Keep a big hunk of it," Warren says. She even throws in a blessing from God for good measure.

Of course, activists and sociologists have been making this argument since forever, and there will always be deniers who claim that taxing the rich is un-American and won't reduce our deficit. Those people will never be swayed by Elizabeth Warren. But politicians need to have the balls to put it her way. It plays up the GOP's unpopular defense of the wealthy's tax cuts while still preserving the notion that Americans deserve to reap the benefits of their own success. To convince people on the fence about Obama's tax plan, we need to ditch the language of sacrifice and assert that when the wealth gap is closed, everybody wins.

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