Democratic presidential candidate Elizabeth Warren‘s wealth-tax is not the right idea when it comes to raising government revenue and reducing income inequality in America, billionaire and longtime Democrat Ron Baron told CNBC on Friday.
“I don’t think Elizabeth Warren would be successful … if she were chosen president in getting through the policies that she’s proposing,” Baron said on “Squawk Box,” speaking from his annual investment conference in New York City.
“It’s pretty nuts,” Baron said, though he did not say which candidate he planned to support for the Democratic presidential nomination.
Massachusetts Sen. Warren’s wealth tax plan calls for a levy of 2% on families’ net worth of above $50 million and 3% on household net worth over $1 billion.
“Warren says if you’re successful because this country has allowed you to be successful .. then you shouldn’t be as successful as you are. You should have some of your money coming back, which just means you are taking jobs you would have created otherwise and give them away,” said Baron.
The Warren campaign did not immediately respond to a request for comment on Baron’s comments.
Rather than a wealth tax, Baron suggested a value-added tax — a VAT, adopted in many European countries, puts levies on goods and services during each stage of production and sale.
“It’s not my job to figure out what policy should be,” Baron insisted, but he said policies should encourage people to invest and “make it as fair and equitable in all business as possible.”
Warren, who has been rising in Democratic presidential polls, has made cracking down on banks and taxing the rich central to her campaign — striking fear in the hearts of Wall Street and Big Business.
In an interview published this week, another billionaire investor, Leon Cooperman, unloaded on Warren’s wealth-taxing proposal and rich-bashing rhetoric.
“What is wrong with billionaires? You can become a billionaire by developing products and services that people will pay for,” the Omega Advisors founder told the website Politico. “I believe in a progressive income tax and the rich paying more. But this is the f—–g American dream she is s——g on,” said Cooperman, son of a Bronx plumber who became one of Wall Street’s most successful investors.
Cooperman has never been shy about how he believes that a Warren presidency would be bad for America, telling CNBC last week: ”If Elizabeth Warren is elected president, in my opinion, the market drops 25%.”
“Stop portraying billionaires as criminals,” Cooperman also said on the morning after Warren and Vermont Sen. Bernie Sanders, in the latest Democratic debate, cast themselves as the hard-liners on tacking wealth inequality.
“They make it sound like rich people don’t pay taxes,” he added.
According to the Real Clear Politics national polling average, Warren was second in the race, with 21.8% support, as of Tuesday. Former Vice President Joe Biden was ahead at 27.2%, with Sanders trailing at 17.3% support in third.