A commenter on the Dakota Free Press Facebook channel suggests that the unread, unreadable Senate GOP tax cuts for the rich aren’t that bad, since the “Obama tax bill” was 4,000 pages long. Unable to find an Obama page count (though you can review the previous administration’s summary on its record of lowering middle-class taxes, raising taxes on the wealthy, and lowering the deficit here), I said length of legislation is not at all as important as impacts and referred my commenter to my favorite three-chart summary from NPR, which shows the Senate GOP tax plan imposing overall losses on folks making under $30K right away and losses on everyone under $75K by 2027.
My commenter seems duly alarmed:
Can you tell me how many Democrats voted against the bill in both the House and Senate and the reason they did so. I only know about the bill from the little bits that were in the papers. And can you tell me why doubling the standard deduction is a bad thing. You said the tax rates are going up and I never knew about this. Can you tell me about new rates. I’m confused about your charts – if this is true, it is totally unacceptable. I am serious, I want to know more [DFP FB commenter, 2017.12.03].
My responses, with style edits and links better integrated than Facebook allows:
Roll call votes:
Senate 51–49, only R No is Bob Corker. All Ds No.
House: 227–205, 13 R No, All Ds No.
Rates: tricky, since we have two bills. The Senate bill keeps seven brackets, while the House bill knocks brackets down to four, raises bottom bracket from 10% to 12%.
Doubling the standard deduction in itself isn’t bad: taxes become easier for many taxpayers, since a $24K standard deduction saves the trouble (and audit risk) of itemizing. However, losing the personal exemption of $4,150 for each member of the household offsets those savings. For larger families who currently itemize, it’s a wash or they end up paying tax on more income.
The charts from NPR don’t show rates alone; they show the net financial impact. Remember that the rates are only applied to taxable income after exemptions and deductions. The situation varies for every specific family, but those charts show that in general, the lower one’s income, the more likely one will end up with less money in one’s pocket if these “tax cuts” pass.
And then to really complicate the situation, don’t forget that once these tax cuts (mostly for the rich) kick in, the increase in the deficit (no reputable economist has shown solid math indicating that they will stimulate enough new economic activity to pay for themselves) will increase pressure for cuts to Medicare, Social Security, and other programs that provide benefits to lots of Americans. Cuts to Medicare and Social Security will make life harder for even those lucky few at the bottom who still come out ahead on the tax cuts.
I can’t speak to exactly why each Dem in Congress voted against this bill, but I can tell you that the above points are central to much of the discussion.
I’d also suggest that the main justification for the bill doesn’t make sense. We’re justifying increased deficit spending by saying that we have to stimulate the sluggish economy. But the metrics right now are saying the economy is growing on its own, without government stimulus. Deficit spending made sense when we were in recession in 2008 and 2009, but there is no similar emergency right now.
Besides, even if we needed government to stimulate the economy, we get far more efficient stimulus from federal spending: food stamps, unemployment insurance, investment in infrastructure, and aid to state governments [CAH, responses to comments on DFP FB, 2017.12.04].
The Atlantic Friday offered a detailed and well-sourced summary of seven main facts about the tax plan that Republicans refuse to acknowledge:
- The tax plan will not pay for itself (see Joint Committee on Taxation and University of Chicago).
- The tax plan will not supercharge economic growth (see JCT and Center for Budget and Policy Priorities).
- The tax plan will not raise wages as much as shift wealth to shareholders (see Tax Policy Center and CBPP).
- The tax plan will not boost corporate investment (see Bank of America/Merrill Lynch, Bloomberg, Congressional Research Service, Institute on Taxation and Economic Policy, and all those CEOs who didn’t raise their hands for Gary Cohn).
- The tax plan will mostly benefit the rich (see TPC) and Trump himself (see CNN, Forbes, Mercury News, Politico, and New York Times).
- The tax plan will not cut taxes overall for the middle class (see TPC).
- The tax plan, specifically the lower “pass-through” rate, helps rich investors, not most small businesses (see TPC and Politico).
It doesn’t matter if the Republican tax plan is 479 pages or 4,000: these changes to the tax code are so bad for so many Americans and so good for so few rich folks that we can only hope reconciling the differences between the House and Senate bills will be too high a hill for Congress to climb.
Can you tell me how many Democrats voted against the bill in both the House and Senate and the reason they did so.
All Dems voted against this joke because Democrats have a conscience and were born with the milk of human kindness in them.
Wingnuts- not so much. Wingnuts show everyone, without saying so, they have compassion only for the well off.
And do not forget wingnuts will rob from the poor to pay for their billionaire taxcuts while not touching runaway military waste and extravagance. Just like their jesus would do.
The better question may be one of process here: why was legislation of this magnitude passed with NO hearings or real investigation of outcomes. The rush even seemed motivated by an attempt to keep information about the cuts contained.
Were the GOP in a hurry because they are afraid that the sitting president is the only president who would be willing to endorse such a shift of wealth to those with the most from those with the least and given how the Moller investigation is going, that President’s days are numbered?
O, I suspect the rush has everything to do with avoiding public scrutiny, rigorous study, and lobbying pressure against passage. The potential of unseating Trump doesn’t seem to bear on this tax plan: if Trump were impeached and convicted or forced to resign, wouldn’t Republicans be just as likely to get Pence’s signature?
Cory, you travel the high road
“refuse to acknowledge” rather than falsehood/lie.
Why are we passing tax cuts focused on the rich and corporations without consulting with expert economists and having their testimony with regard to the effects of this policy change?
Only one economist out of 42 surveyed by the University of Chicago’s School of Business said that the Republican tax bill would cause GDP to be “substantially higher a decade from now.”
https://www.vox.com/policy-and-politics/2017/11/22/16691016/economists-gop-tax-plan-igm-poll
The one economist in the above story that said the GOP tax bill would substantially help the economy also stated the following: “Whether the overall tax plan is distributionally fair is another matter.”
On the other hand, though we have had no serious hearings with expert testimony, Paul Ryan and Rob Portman released a letter purporting to be signed by 137 economists which turned out to include a guy working as a paralegal and a mid level state tax collector who doesn’t remember signing the letter.
Pence is another Russian that Flynn implicated so he is out of the game soon after trump. Ryan is Russian as well and Hatch is a Russian Mormon, so we can expect a big ol temple in Moscow. The only way to get this cut cut cut tax bill is to defeat those who put it into play.
Democrats now have their 2018 and 2020 rallying cry:
REPEAL AND REPLACE TRUMP’S TAX BILL
LOCK THEM UP!! REPLACE AND JAIL RUSSIANS.
Cory, you have to have a backroom for a breakfast buffet. So russian republicans are at the ready to punish more. Next time NOem/Thune/Rounds or any of the like comes in for a meal, put a booger in it for their tip. http://www.epi.org/press/proposed-rule-would-protect-employers-who-steal-workers-hard-earned-tips/
The new tax plan is great – it rewards all those hard working rich folks for their hard work and sacrifices, and makes sure all the poor people know that it is their own fault they aren’t rich and successful:
“I think not having the estate tax recognizes the people that are investing as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.” – Iowa Sen. Chuck Grassley, November 2017
Sounds like an airtight policy argument to me.
Anybody here hired that Mandarin tutor for their kids yet?
RMB 150 per hour seems to be the going wage. I have no idea how to translate Yuan to dollars or vice versa. Leave us just hope yer tax refund is generous to a fault- the fault being yers , of course.
Ryan—hee hee!
Roger, I think Jerry has the tighter slogan: “Lock him up!” However, on policy relevance, how about we just tighten yours up. We need one word to encapsulate the bill we want to repeal, like Obamacare. How about, “Repeal and Replace TrumpTax”?
https://crooksandliars.com/2017/12/doh-mitch-mcconnell-killed-all-corporate
Maybe this will make it smell a little better. McCTurtle apparently dealt away all korporate breaks to get the votes to pass this mess.
How about “WealthyCare”
mfi, your C & L link made me laugh out loud, Thanks!
Bear, thanks. This would be really funny if wingnuts weren’t in a position to do so much harm to the economy and the nation’s peoples who aren’t billionaires. They have the entire government structure in their control, they have changed the rules to pass legislation with a simple majority and no Democratic involvement and they still can’t accomplish much,
I wonder how future wingnut historians will pin this on Dems and obstruction? You know they will.
Possible big news coming out of congress, today. Stay tuned.