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Sen. Elizabeth Warren is focused on bringing in more tax revenue for the IRS

STEVE INSKEEP, BYLINE: Our next guest makes a case for how to finance a giant budget plan. Senate Democrats are near final passage of a single bill that contains many of their priorities, from child tax credits to climate measures. That 10-year legislation would add to the federal debt, according to an accounting by Congress, but it would recover some of its costs from wealthy Americans and corporations. And for Democratic Senator Elizabeth Warren of Massachusetts, taxing the wealthy is an issue by itself. She came to the phone yesterday.

ELIZABETH WARREN: As you know, right now, there are corporations that publicly report more than a billion dollars in profit - yes, Amazon, I'm looking at you - and at least 70 other corporations who pay little or nothing in taxes. We're going to take a look at your - what are called book profits, the profits you report publicly. And you've got to pay at least 15% on those profits. That stitches up a whole lot of loopholes that all the lobbyists have built into the tax code for a long time. And it is going to produce a lot of money.

INSKEEP: Would you answer a conservative argument about another way that this bill is supposed to be paid for? There's supposed to be better IRS enforcement, tens of thousands of new IRS agents. But Republicans, like Nancy Mace of South Carolina, who's been a reasonably serious legislator, says this is a case of IRS agents being called upon to spy on people, that there's just going to be more audits and more pain for ordinary people. How do you answer that argument?

WARREN: She should read the bill, for openers. The IRS, right now, is badly underfunded. And the consequence of that is the IRS can afford to do audits of people who don't make a whole lot of money because those audits are pretty simple. And that's where the IRS spends a lot of its time and effort right now. They don't have the resources to go after the billionaires, to be able to investigate what's happening. The current commissioner of the IRS, who, by the way, was appointed by President Trump - that commissioner says we're losing a trillion bucks to these high net worth individuals who are just not paying what they owe under current law.

INSKEEP: Let me ask, though, about a cynical view sometimes of lawmakers who propose better enforcement of the tax code to pay for their programs. Traditionally, lawmakers propose that when they don't want to propose a higher tax rate, which would be unpopular in some circles, so they call for better tax enforcement, which often doesn't raise as much money as people think because taxpayers just change their behavior to get around the law. And in fact, the Congressional Budget Office seems to be skeptical of this as a revenue raiser.

WARREN: Well, let me remind you on this, I want to do both. I think we should raise the rates. I think we need a wealth tax in America. But I also think we need to enforce the tax laws we already have. This is breaking the law, not exploiting loopholes, not you argue it this way; I argue it that way. It is about breaking the law.

INSKEEP: At the same time, of course, prices for families are going up as inflation rises at the highest rate in decades. Larry Summers, former Treasury secretary, blamed some of the federal spending for that inflation, at least in part. Do you view the inflation of this moment as a permanent threat that the government has to act against?

WARREN: Look. Prices are up. That's always a concern. But you've got to disentangle the reasons for this. Workers have been able to insist on raises, and that's a good thing. But another reason that we have seen prices go up is that we're now paying the price for decades of underenforcement of antitrust laws. Think about the two big examples we've heard a lot about in the news - the increase in the cost of a turkey and the increase in the price of a gallon of gasoline up until the last few days. In both cases, what we're seeing is that the profit margins are jumping like crazy. In other words, that's just plain old price gouging.

INSKEEP: But we have universal, almost, inflation. The cost of everything is going up, and there are real shortages of things like chips to make cars or almost anything that gets shipped through the Port of Los Angeles. Isn't there something real here as well?

WARREN: Oh, there are lots of pieces for what's going on, but it is important not to overlook some long-term trends, like concentration in industries, that have permitted them at this moment to be able to push profits up rather than just say, costs have gone up, and therefore I'm only passing along increased costs.

INSKEEP: One of the things - Senator Warren, you have said that you oppose Jerome Powell's renomination to chair the Federal Reserve. Of course, President Biden has renominated him. Why not keep around the guy who steered the country through the pandemic?

WARREN: Well, the chairman of the Federal Reserve has two jobs. One is monetary policy, and the second one is regulatory policy. Chair Powell has followed monetary policy that I think a lot of Democrats also would have followed. But on regulatory policy, his position has consistently been to deregulate.

The reason this is so important is it was the Fed that fell down on the job in the years leading up to 2008 because they refused to rein in the biggest financial institutions. Millions of people lost their homes. Millions of people lost their jobs.

And now, what we've got again is a chair of the Fed who shows no interest in reining in the biggest financial institutions, and at a time when our economy faces a lot of risk. Crypto has increased sixfold over the last year. A big nonbank financial institution, like BlackRock, controls more assets - double the amount that the entire country of Japan has. And yet, the Fed won't declare it a systemically significant financial institution. And you can just keep going through the list. It's important that we have a Federal Reserve that is not only careful on monetary policy, but also shows that it has the backbone to stand up to the big financial institutions and to rein in risks before they get out of hand and bring down our entire economy.

INSKEEP: Senator Elizabeth Warren, always a pleasure talking with you. Thank you so much.

WARREN: Oh, and good to talk with you, too. Take care.

(SOUNDBITE OF SHARK QUEST'S "KELL") Transcript provided by NPR, Copyright NPR.