GOP Tax Plan is Class Warfare in Policy Form
It took ten months, but wealthy GOP financiers finally got what they’ve been waiting for.
Knowing that tax cuts for the wealthy are wildly unpopular, Republican politicians began branding this looting of the treasury as tax reform. Trump, though, could not help himself, and bragged that he would sign into law the biggest, best tax cuts in history.
Call it reform, cuts, or what have you – the Republican tax plan is class warfare in policy form.
Everyone earning $30k or less will pay more in taxes initially, and by 2027 everyone earning $75k or less will pay more. According to the NYT, people earning $40k-$50k will pay $5.3b more in taxes while millionaires will pay $5.8b less.
Before getting into the details of how exactly Republicans want to screw the country, consider why it is that they would pull this trickle-down triple-down despite the knowledge that supply-side economics is a proven failure and that the House version of the bill polls at just 17% approval.
The simple answer is because the Republican Party financiers demand it. It is their single unifying force – not the social issues of the religious right, not immigration or culture wars, but pure and simple greed – and they threatened to cut off the funding for Republican congressfolk if they failed to deliver a reverse-Robin Hood tax code.
They could have pulled the plug on Trump long ago. For them, his antics serve as a distraction. The Mueller investigation, however, meant that their precious tax cuts for the wealthy had to be expedited. Now that he’s served his purpose, for the financiers controlling the Republican Party, Trump is disposable. The base simply adores him no matter what he does, so GOP politicians with impeachment authority are reluctant to do so. But if they believe Trump will drag them down electorally in 2018 and the 25th Amendment comes into play…perhaps Alzheimer’s begins to seem a reasonable excuse to resign with feigned dignity.
Knowing how unpopular their tax plan is, Senate Republicans were still making hand-written changes in the final hours to the 2500 page bill which had no CBO score and on which they held no hearings; and they used the reconciliation process so that they would need but a simple majority to push it through on partisan lines.
They also pushed back the date of implementation to 2018 so voters won’t have felt the full affects until after mid-term elections. Here’s what it does:
Brackets are being eliminated in what Republicans call simplification - so if you paid 10% before, you will now pay 12%. Those are among the poorest people in the country, and Republicans are purposely raising their taxes. If you paid 15% before you will pay 25%. Those are the majority of working people, and Republicans are raising their taxes significantly.
Republicans eliminated the deduction teachers get when they buy supplies for students in need. Republicans eliminated the deduction you get when you have to move for your job. Republicans eliminated the deduction you get when you adopt a child.
If you save your receipts and deduct your local sales tax, no more – Republicans eliminated the state and local tax deduction. If you deduct your local income tax, no more; this has the dual effect of punishing blue states for taxing the wealthy. If you deduct your property taxes, no more; property taxes fund public schools and states will now be effectively punished for collecting them. Private schools, on the other hand? Ted Cruz’s amendment gives them more funding.
Republicans eliminated the student loan interest deduction in what amounts to a tuition tax. If you are in a work-study program to pay tuition that money will now be taxed as regular, taxable income; this will starve universities of all but independently wealthy graduate students as their taxable income could triple.
In an incredibly baffling move, Republicans eliminated the $4,050 personal exemption. And since they have no shame whatsoever, they are doubling the standard deduction so fewer people will itemize and charities – charities! – will be punished.
And what did Republicans buy with trillions of dollars in tax hikes on regular people?
Republicans lowered the corporate tax rate from 35%-20% - plus a tax repatriation holiday for multinational corporations of 12%. Republicans lowered the top rate on pass-through businesses from 40%-17.4% (mortgage, accounting, and law firms; doctors’ offices; one Donald J. Trump). Republicans raised the cap on the mortgage interest deduction to $1m so wealthier people will be able to take advantage. Republicans included language that says taxes cannot be collected on the maintenance of private jets.
Republicans eliminated the estate tax altogether, which only applied to a few hundred of the wealthiest families in the country. Those few hundred families control not only the wealth of the country but they’ve bought the government and they are using their servants to rig the tax code for increased upward wealth redistribution. The poor will go to defunded public schools, and tuition and high student loan rates will be a barrier to attending college - while the wealthy send their trust fund kids to private schools which will feed the best universities. Generation after generation will be legacy students who will be lavished with ungodly amounts of money, tax-free without ever having to work for it. Handed positions of power by birthright, they will form a permanent, ruling class of wealthy aristocrats.
In the meantime, the Republican tax plan – even allowing for their nonsensical economic growth projections using dynamic scoring - will add at least a trillion dollars to the deficit. They will transfer wealth from the working poor to the top, from blue states to red, and starve the federal government of revenue. Republicans will then turn around and demand regular people be punished even more with further shredding of the social safety net, namely Social Security, Medicare, and Medicaid.