The Trump Tax doesn’t just cut tax rates for rich people. It also triggers the 2010 Pay-Go law, brought to you by the fiscally responsible Obama Administration and Democratic 111th Congress, which requires that new taxing and spending legislation not increase the deficit.
Right off the bat, Pay-Go will start making up for Trump’s $150 billion in new annual deficit spending by taking $307,000 in mineral royalty payments away from South Dakota. South Dakota’s farmers and Medicare recipients will also take a hit:
Congress can suspend Pay-Go, but the Senate will need 60 votes to make that happen. If they don’t, rural America takes a hit:
…in the absence of a suspension of PAYGO, the House and Senate agriculture committees will have $140 billion less—over the ten-year period which is used to determine the cost of a program—with which to fashion the policies they want to make a part of the 2018 Farm Bill. This will affect not only commodity programs, but also young farmer programs, grants available for university agricultural research, environmental programs like EQIP (Environmental Quality Incentives Program), funds to support local ASC offices, and much more.
In addition, many non-agricultural programs that are important to rural areas could be affected. Without suspension of PAYGO, rural US highways and bridges, rural hospitals, the Forestry Service, small business loans, and programs that we don’t even think about could all be negatively impacted by budget cuts [Harwood D. Schaffer and Daryll E. Ray, Agricultural Policy Analysis Center, “Tax Cuts ‘Give.’ Pay-As-You-Go Takes It Away?” Farm Forum, 2017.12.19].
But hey, at least the richest 4% of farms will qualify for a lower corporate tax rate. And some lucky portion of the tiny fraction of farms subject to estate tax (only 0.4% paid last year) will get a break from Kristi Noem’s totally principled opposition to the estate tax.