It Started as a Tax Cut. Now It Could Change American Life.

The tax plan has been marketed by President Trump and Republican leaders as a straightforward if enormous rebate for the masses, a $1.5 trillion package of cuts to spur hiring and economic growth. But as the bill has been rushed through Congress with scant debate, its far broader ramifications have come into focus, revealing a catchall legislative creation that could reshape major areas of American life, from education to health care.

Some of this re-engineering is straight out of the traditional Republican playbook. Corporate taxes, along with those on wealthy Americans, would be slashed on the presumption that when people in penthouses get relief, the benefits flow down to basement tenements.

Some measures are barely connected to the realm of taxation, such as the lifting of a 1954 ban on political activism by churches and the conferring of a new legal right for fetuses in the House bill — both on the wish list of the evangelical right.

With a potentially far-reaching dimension, elements in both the House and Senate bills could constrain the ability of states and local governments to levy their own taxes, pressuring them to limit spending on health care, education, public transportation and social services. In their longstanding battle to shrink government, Republicans have found in the tax bill a vehicle to broaden the fight beyond Washington.

The result is a behemoth piece of legislation that could widen American economic inequality while diminishing the power of local communities to marshal relief for vulnerable people — especially in high-tax states like California and New York, which, not coincidentally, tend to vote Democratic.

All of this is taking shape at such extraordinary velocity, absent the usual analyses and hearings, that even the most savvy Washington lobbyist cannot be fully certain of the implications.

Mr. Trump and the Republican leadership in Congress — stymied in their efforts to repeal Obamacare, and short of legislative achievements — have signaled absolute resolve to get a tax bill passed by the end of the year. As the sense has taken hold that Washington is now a trading floor where any deal is worth entertaining so long as it brings votes, interest groups have fixed on the tax bill as a unique opportunity to further their agendas.

“There’s a Christmas-tree aspect to the bill,” said C. Eugene Steuerle, a Treasury official during the Reagan administration and now a senior fellow at the Urban Institute. As an example, he cited the provisions in the House bill designed to appeal to the religious right.

“People want to add certain things, and if they don’t cost a lot, it’s a way to buy in agreement,” Mr. Steuerle said.

Economists and tax experts are overwhelmingly skeptical that the bills in the House and Senate can generate meaningful job growth and economic expansion. Many view the legislation not as a product of genuine deliberation, but as a transfer of wealth to corporations and affluent individuals — both generous purveyors of campaign contributions. By 2027, people making $40,000 to $50,000 would pay a combined $5.3 billion more in taxes, while the group earning $1 million or more would get a $5.8 billion cut, according to the Joint Committee on Taxation and the Congressional Budget Office.

“When you put all these pieces together, what you’re left with is we are squandering a giant sum of money,” said Edward D. Kleinbard, a former chief of staff at the Congressional Joint Committee on Taxation who teaches law at the University of Southern California. “It’s not aimed at growth. It is not aimed at the middle class. It is at every turn carefully engineered to deliver a kiss to the donor class.”

In a recent University of Chicago survey of 38 prominent economists across the ideological spectrum, only one said the proposed tax cuts would yield substantial economic growth. Unanimously, the economists said the tax cuts would add to the long-term federal debt burden, now estimated at more than $20 trillion.

See full story

https://www.nytimes.com/2017/1...blican-tax-cut.htmlv

 

 

The stupidity of liberals, ability to ignore their ignorance

 

Original Post

Oh, so it turns out the Republicans really don't care about doubling the deficit,just as long as it's not done by a Democrat. Republicans have to be wondering exactly why they elected this administration.

The Republicans control the House, Senate, and the Presidency and still can't seem to get their agenda passed.

The Democrats wasted over $9 trillion attempting to jump start the economy.  The result was an average GDP growth of 1.8 percent for 8 years -- the worst recovery in over 100 years.

The Austrian and Chicago schools of economics argue that the limits for income tax is between 25 and 30 percent, respectively, before revenue declines.  Per OMB, in constant 2005, dollars, the Bush tax cut resulted in $4.6 trillion more in revenue, than the previous 8 years under Clinton.  The Reagan tax cuts yielded $2.94 trillion more in revenue, than the previous 8 years.  The tax cuts requested by JFK, but passed by LBJ in 1964 yielded $522.2 billion more than the preceding 4 years.

As to the NY Times, if they stated it was raining, I'd eschew an umbrella.  Demmie economists stated that a GDP growth of about 2.2 percent annually is the most we would ever experience -- the new normal. 

SirWasabi posted:

Oh, so it turns out the Republicans really don't care about doubling the deficit,just as long as it's not done by a Democrat. Republicans have to be wondering exactly why they elected this administration.

The Republicans control the House, Senate, and the Presidency and still can't seem to get their agenda passed.

I believe that using the not very dynamic scoring of an average of 1.9% GDP growth, the bean counters project that the National Debt will grow by $1 Trillion over 10 years. Considering that the 2017 deficit is $443 Billion and the National Debt is over $20 Trillion, I suspect that you have far exceeded Sam Clemons and Ol' Ben Disreali's "Lies, damm lies, and statistics". Considering that the last two quarters have been above 3% GDP growth with just regulatory relief, that projected Trillion bucks will probably be less. 

Also, even if that $1 Trillion pans out, that is still small potatoes with the Obama administration legacy cost deficits:

Federal Debt Projected to Grow by Nearly $10 Trillion Over Next Decade

https://www.nytimes.com/2017/0...t-deficit-trump.html

 

 

  

direstraits posted:

About 3 to 3.5 percent GDP growth would solve the deficit problem.  However, congress must hold the growth of the budget.  Unfortunately, cash to a politician of any ilk is like an opioid or heroin to an addict.

Unfortunately for us all, no one took de Tocqueville's warning seriously and politicians have been feeding the porcine corporatists and leeches with our tax money (That includes unions which are considered a corporation in corporatist economics!).

 

 “The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money.” 
― Alexis de Tocqueville

 

 

Republicans have been pushing some form of the 'Trickle Down Theory' for in excess of 90 years. That agenda caused the greatest concentration of wealth, in the 1%, in history and the depressions of '29 and '07, yet here we are again. Same old song and dance.

SirWasabi posted:

Republicans have been pushing some form of the 'Trickle Down Theory' for in excess of 90 years. That agenda caused the greatest concentration of wealth, in the 1%, in history and the depressions of '29 and '07, yet here we are again. Same old song and dance.

Nope, for the 1929 crash and burn that would be the tight money policy of the Federal Reserve and for the 2008 bust, that would be creating laws and rules during the 1990s to put people in houses they could not afford:

BERNANKE: FEDERAL RESERVE CAUSED GREAT DEPRESSION

http://www.wnd.com/2008/03/59405/

Government Policies Caused The Financial Crisis And Made the Recession Worse

https://www.forbes.com/sites/n...-worse/#65a21707564e

To be fair to you, those wealthy folks who got caught up in the get-rich-quick schemes of the moment didn't help either. 

Republicans controlled U.S. policy for the decade leading up to the Great Depression just as they controlled U.S. policy for the decade leading up the the Great Recession. Now, they're making policy again. You can fool some of the people all of the time, or we wouldn't have Republicans.

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