2020 sweepstakes: Dem candidates compete to give away billions in taxpayer $$
"Medicare-for-all" and free community college are just the starting point. Some candidates vying for the Democratic presidential nomination are going beyond promising gobs of government benefits and proposing a more straightforward approach -- simply giving away money.
Candidates like Cory Booker, Marianne Williamson and Andrew Yang are among those pitching cash handout plans this election cycle.
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And for Yang, a tech entrepreneur who warns that an automation crisis will soon rock America's economy, the handout program is his defining campaign policy. His plan is simple, on the surface: every American citizen over the age of 18 gets $1,000 every month.
"My flagship proposal, the 'freedom dividend,' would put $1,000 a month into the hands of every American adult. It would be a game-changer for millions of American families," he said at last month's CNN-hosted debate in Detroit.
The only major caveat for Yang's plan is that those receiving benefits such as welfare or disability would not be eligible, but would have the option to collect their existing benefits or get the $1,000.
Yang’s plan to pay for such a costly endeavor would be to institute a Value-Added Tax (VAT) of 10 percent on the production of goods and services, which he estimates would raise $800 billion. He also proposes a carbon fee as a tax on pollution, as well as higher tax rates for capital gains and a financial transactions tax to collect greater revenue from wealthier Americans.
Booker, meanwhile, has his own proposal which he's already pursuing in Congress -- legislation to start a savings account for every American child when they're born.
“Wealth inequality is at its highest point in decades—and because household wealth shapes opportunity, extreme wealth inequality in America is undermining equal opportunity,” Booker said in a July press release.
The plan, dubbed “baby bonds,” is part of a bill that Booker and Rep. Ayanna Pressley, D-Mass., recently reintroduced called the American Opportunity Accounts Act. It would give each American child an interest-bearing savings account with $1,000 in it when they are born, with up to $2,000 in additional deposits each year until they turn 18. They would then only be permitted to use the money for certain expenses such as higher education or purchasing a home.
That plan would cost American taxpayers as much as an estimated $70 billion, according to a Yahoo report when the bill was first introduced in 2018. A press release from Booker and Pressley claims that this would be “fully paid for by making common-sense reforms to federal estate and inheritance taxes, including restoring the estate tax to 2009 levels.”
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Williamson’s platform includes a far more costly plan to pay between $200 billion and $500 billion over a 20-year period to black communities as reparations for slavery. She views that money as “payment of a debt that is owed” due to “a great injustice that has never been dealt with.”
The spiritual author claims that this number is in reality far lower than what it could be, given what freed slaves were promised upon emancipation.
“If you did the math of the 40 acres and a mule, given that there were four to five million slaves at the end of the Civil War, and they were all promised 40 acres and a mule for every family of four,” she said during July’s Democratic debate, “If you did the math today it would be trillions of dollars.”
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Williamson’s plan does not call for the money to go directly to individuals. According to her campaign’s website, “An esteemed council of African-American leaders would determine the educational and economic projects to which the money would be given.”
California Sen. Kamala Harris also has proposed a measure that would give Americans monthly payments. In October 2018 she announced legislation that would provide a tax credit for individuals who earn less than $50,000 a year or families earning less than $100,000. People could opt to receive this in one payment for the year or in monthly installments that would be as much as $250 for individuals and $500 for families.
The amount is based on earnings, so while high earners would not be eligible, neither would those who do not earn any income.
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These plans are on top of Medicare for All and free public college, ideas supported by 2020 candidates Bernie Sanders, Harris, and Elizabeth Warren.