As WaPo points out this is a bipartisan study but the results are not surprising – Bernie Sanders (massive) tax plan falls short by $18 trillion which is almost the current level of the US deficit. I will make one comment – I am far from a macro expert but I do know from numerous cases in history and especially post communist Europe that a total overhaul of the economy will not immediately produce results – even if successful it usually takes a long time and is a painful process – there is no way in hell Bernie Sanders can entirely overhaul the economy and expect 5.3 percent GDP growth even in the first few years of that transition, but then again many of his supporters (like Trump ones) focus on slogans over facts.

An Analysis Of Senator Bernie Sanders’s Tax And Transfer Proposals by Gordon Mermin, Len Burman, and Frank Sammartino – Tax Policy Center


Presidential candidate Bernie Sanders proposes significant tax increases that would raise $15.3 trillion over the next decade. All income groups would pay more tax, but most new revenue would come from high-income households and particularly those with very high incomes. Sanders would also implement new government benefits—notably government-financed single-payer health care, long-term services and supports, tuition-free public colleges and universities, and family leave benefits—and expand Social Security benefits. The Tax Policy Center finds the new government benefits would more than offset new taxes for 95 percent of households, but the combined tax and transfer plan would increase federal budget deficits by more than $18 trillion over the next decade.

An Analysis Of Senator Bernie Sanders’s Tax And Transfer Proposals – Introduction

In March, the Tax Policy Center estimated that presidential candidate Senator Bernie Sanders’s tax plan would increase tax revenue by $15.3 trillion over the next decade (Sammartino et al. 2016). All income groups would pay some additional tax, but most new revenue would come from high-income households. But taxes are only part of the story. Along with an expansion of Social Security benefits, Senator Bernie Sanders proposes a number of new government benefits, including single-payer health care, long-term services and supports, free public college tuition, and paid family leave. Those proposals affect the distribution of winners and losers and the federal budget deficit. For most households, additional government benefits would more than offset the tax increases. But the additional revenue would fall far short of paying for the new spending programs. Without more revenue, the Sanders plan would increase federal deficits by more than $18 trillion over the next decade.

This analysis estimates the effect of the Sanders tax and transfer proposals by combining results from separate Urban Institute models. We use the Urban-Brookings Tax Policy Center Microsimulation Model (TPC model), the same model used to simulate the Sanders tax proposals, to simulate family leave benefits and the net benefit of proposed free tuition at public institutions. We incorporate results from the Urban Institute Health Policy Center’s Health Insurance Policy Simulation Model (HIPSM) for his single-payer health care plan and estimates from the Urban Institute Income and Benefits Policy Center’s Dynamic Simulation of Income Model (DYNASIM3) for his long-term services and supports and Social Security plans. We do not model other spending proposals, such as increased investment in infrastructure or the youth jobs program, because it is difficult to quantify their benefit to families. Because we combine results from separate models relying on different underlying data sources, these results are less precise than if they had come from a unified model of taxes and spending.

The combination of the Sanders tax and transfer proposals would increase average household income, net of taxes paid and transfers received, by nearly $4,300 in 2017. Households in the bottom 95 percent of the income distribution would, on average, receive a net benefit while the highest-income households would pay more in new taxes than they would receive in additional government transfers. The combined plan would increase annual federal budget deficits by $1.8 trillion over the next 10 years.


Senator Bernie Sanders has proposed expanding social insurance programs, increasing government investment in physical and human capital, and aggressively addressing climate change. He would pay for those and other programs by raising taxes on individuals and businesses. This analysis focuses on changes to taxes and social insurance programs.


Senator Bernie Sanders would increase federal income, payroll, business, and estate taxes significantly and impose new excise taxes on financial transactions and carbon. In March, the Tax Policy Center estimated that those changes would boost federal revenue by $15.3 trillion between 2016 and 2026 (Sammartino et al. 2016). The plan would increase tax burdens for households at all income levels, but the increase would be much larger both in absolute dollars and as a share of after-tax income for the highest-income households.

Single-Payer Health Care

Senator Bernie Sanders proposes a single-payer health care system that would replace the existing employer-based health insurance system as well as Medicare, Medicaid, and the programs established under the Affordable Care Act.3 The new benefit would be comprehensive and eliminate individual cost-sharing. It would be significantly more generous than current-law Medicare or typical private insurance. Holahan et al. (2016) estimate that the new program would increase total public and private spending on health care, other than long-term services and supports, by $5.5 trillion over 10 years. However, federal spending on acute care would rise by $29 trillion as it would replace virtually all private spending—employer-sponsored health insurance, private nongroup coverage, and net premiums paid for insurance purchased under the Affordable Care Act—as well as state spending on Medicaid. Although the details and total cost of the Sanders health care plan are uncertain (Holahan et al. 2016) its cost would significantly exceed the revenues raised by his tax plan.

Long-Term Services and Supports

Senator Bernie Sanders would also provide comprehensive coverage for long-term services and supports (LTSS).4 This would replace both Medicaid LTSS spending and some portion of private spending on LTSS and informal caregiving by family members. The DYNASIM3 model estimates that the Sanders proposal would increase total spending (federal, state, and private) on LTSS by over $1 trillion. However, federal spending on LTSS would increase by $2.9 trillion over the next 10 years because it would supplant state and private spending (Holahan et al. 2016).

Eliminate Undergraduate Tuition at Public Colleges and Universities

Senator Bernie Sanders proposes to eliminate tuition for undergraduates at public colleges and universities, with the federal government paying 67 percent of the cost for states choosing to eliminate tuition.5 We estimate that federal spending under the program, net of reductions in education tax credits, would increase by $807 billion over 10 years. This estimate relies on three important assumptions: (1) college attendance would not increase, (2) students would not switch from private to public colleges, and (3) public colleges and universities would not increase tuition. The estimated cost thus reflects only a reallocation of spending from private sources to public ones. Federal costs could be significantly higher if those assumptions do not hold. On the other hand, we assume that all states would choose to participate in the matching-grant program and waive tuition. As the recent expansion of Medicaid under the Affordable Care Act suggests, this may not be the case.

Family and Medical Leave

The Sanders

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