Expand chart
Adapted from Emmanuel Saez, 2019, "Taxation of Financial Capital: Is the Wealth Tax the Solution?; Chart: Andrew Witherspoon/Axios

A Twitter debate about the veracity of an economic study projecting the outrageously low tax rates of billionaires turned into a verbal street brawl at the Peterson Institute for International Economics in Washington Thursday.

Background: Criticism has been heaped on a Washington Post op-ed by Emmanuel Saez and Gabriel Zucman purporting to show that for the first time in U.S. history billionaires paid a lower tax rate than the working class.

  • Critics have taken issue with the study's conclusions and methodology.

What happened: Economist Larry Summers tore down the study and its co-author Saez, who was in attendance, like a disrespectful step-daddy during a presentation and panel discussion.

  • "I find myself persuaded by [Saez and Zucman’s] critics that the data are substantially inaccurate and substantially misleading."
  • "I used their algorithm on my tax return to figure out my wealth and it was not within a country mile of reality."

The former Treasury Secretary and head of the National Economic Council was far from finished.

  • "I do not think a focus on wealth inequality as a basis for being concerned about a more just society is terribly well designed," Summers continued, noting that he believed Saez and Zucman had overestimated "by a third" the amount of wealth held by American billionaires and that he doubted the tax would deliver "even half of their wealth figure."

Between the lines: Summers seemed to "take it really personally," Saez told Axios after the panel discussion.

Of note: Harvard economist N. Gregory Mankiw, who served in the administration of President George W. Bush presented a 12-minute lecture that lent support to Andrew Yang's universal basic income proposal.

  • "I don't know Andrew Yang at all, so I'm not endorsing him," he told Axios after the event. "But universal basic income, which provides a fairly robust safety net for people at the bottom of the economic ladder, to me makes sense."

Go deeper

Updated 53 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 9:30 p.m. ET: 19,499,341 — Total deaths: 723,881 — Total recoveries — 11,864,471Map.
  2. U.S.: Total confirmed cases as of 9:30p.m. ET: 4,999,836 — Total deaths: 162,382 — Total recoveries: 1,643,118 — Total tests: 61,080,587Map.
  3. Politics: Trump signs 4 executive actions on coronavirus aid — Democrats slam Trump, urge GOP to return to negotiations
  4. Public health: Fauci says chances are "not great" that COVID-19 vaccine will be 98% effective — 1 in 3 Americans would decline COVID-19 vaccine.
  5. Science: Indoor air is the next coronavirus frontline.
  6. Schools: How back-to-school is playing out in the South as coronavirus rages on — Princeton, Johns Hopkins, Howard to hold fall classes online.

Trump signs 4 executive actions on coronavirus aid

President Trump speaking during a press conference on Aug. 8. Photo: Jim Watson/AFP via Getty Images

President Trump on Saturday signed four executive actions to provide relief from economic damage sustained during the coronavirus pandemic after talks between the White House and Democratic leadership collapsed Friday afternoon.

Why it matters: Because the Constitution gives Congress the power to appropriate federal spending, Trump has limited authority to act unilaterally — and risks a legal challenge if congressional Democrats believe he has overstepped.

9 hours ago - World

What's next for Lebanon after the Beirut explosion

Photo: Houssam Shbaro/Anadolu Agency via Getty Images

Beirut residents are still clearing rubble from streets that appear war-torn, days after a blast that shocked the country and horrified the world.

Why it matters: The explosion is likely to accelerate a painful cycle Lebanon was already living through — discontent, economic distress, and emigration.