Elizabeth Warren slams Republicans for creating 'economic chaos' to protect the rich

Sen. Elizabeth Warren on Monday took aim at the Republican Party for creating what she called a "manufactured crisis" as a potential fight over the debt ceiling looms, slamming the GOP's threats to public spending as the party works to make it even easier for the wealthy to avoid paying taxes.

On MSNBC's "Morning Joe," the Massachusetts Democrat said the Republicans are actively trying to "wreck the economy" to protect the wealthy.

"If the Republicans had not pushed just two things, the Republican tax cuts that went mostly to those at the very top and the biggest corporations and hollowing out the IRS specifically so they could not hold wealthy tax cheats accountable, wouldn't be able to audit them—if those two things had not happened, then we wouldn't even hit the debt ceiling at any time during the first Biden administration," said Warren.

The Republican Party has for years cut funding to the Internal Revenue Service (IRS) when it had the power to do so, diverting efforts away from auditing the wealthiest taxpayers and costing an estimated $125 billion in corporate taxes each year, and as Warren noted, House Speaker Kevin McCarthy (R-Calif.) began the new session of Congress earlier this month with a vote by the party to rescind billions in IRS funding that Democrats passed to crack down on tax evasion.

Far-right Republicans are also now proposing a nationwide sales tax to replace income taxes and other federal taxation—a regressive plan which, according to the Tax Policy Center, would leave households on the lower 80% of the income distribution paying nearly 35% of federal retail sales taxes, up from about 15%.

The sales tax would be "on everything from rent to groceries to diapers to car repairs," said Warren, and would "cut taxes for those at the very top."

The Republicans have pushed these proposals as U.S. Treasury Secretary Janet Yellen announced last week that the U.S. government had reached its debt limit of $31.4 trillion, which was set by Congress when it last raised the borrowing ceiling in December 2021.

The Treasury Department began implementing what it called "extraordinary measures" to avoid a debt default—selling investments and suspending reinvestments in the Civil Service Retirement and Disability Fund and the Postal Service Retiree Health Benefits Fund, which will not affect retirees or federal workers.

Yellen warned that those accounting maneuvers may only be possible until June and after that, "a failure to make payments that are due, whether it's the bondholders or to Social Security recipients or to our military, would undoubtedly cause a recession in the U.S. economy and could cause a global financial crisis."

In addition to further shifting tax burdens from the wealthy to lower-income households, Republicans have indicated they won't agree to raise the debt ceiling without cutting social spending on programs such as Medicare and Social Security, which they have long blamed for national deficits.

"If this were really about the national debt, then there are plenty of places we could go to stitch up loopholes, like no more of these tax havens abroad, that we could get that under control. But that is not where the Republicans want to go," Warren said on "Morning Joe."

Warren noted that the GOP voted to raise the debt ceiling multiple times when former Republican President Donald Trump was in office, as the party pushed tax cuts for the wealthy.

"Once we've got a Democrat in the White House, no, they don't want to raise the debt ceiling," said the senator. "They want to create as much economic chaos as they can and keep offering tax cuts to their rich buddies."