The deal appears set for a massive tax give-away to corporations and the super wealthy. News reports are that the Senate and House have agreed that their deficit-busting tax bill will be ready to send to Donald Trump next week. The president, in desperate need of a political victory, is itching to sign that bill into law. He has promised his wealthy donors over and over again that big, beautiful tax cuts were coming. And he is on the precipice of delivering.
But it does not and should not be this way. Moderate Republicans know that as surely as they know that, if the Trump tax plan becomes law, they will be sending the national deficit soaring and taking the first step toward making up the deficit on the backs of low and moderate-income people. They should prepare to pay the price at the ballot box.
Even with Trump’s wobbly promise to support a bill to stabilize the Affordable Care Act marketplaces, the massive tax give-away to corporations and the super wealthy is still a dreadful deal for low-income and middle-class Americans. Indeed, the Economic Policy Institute’s Hunter Blair writes, the Republicans’ well-worn “trickle-down” economic talking point is just that – a rhetorical flair to propel bogus policy. Extending even more generous tax benefits and breaks to American corporations and a sliver of the uber wealthy will not spur job creation – no factories or other jobs of any sort are coming to Allentown, Pa., or Youngstown, Ohio because of Trump’s massive tax give-away.
Instead, Blair’s work and other studies show that this tax bill will eventually result in tax hikes for middle class and lower income families. As Congressman Sander Levin (D-Mich.) said, “In reality, the middle class will get stuck with the bill for this debt [caused by the massive corporate tax give-away], either through a future deficit tax, or through cuts to programs they depend on, such as Medicare.” The congressman is almost correct, but Medicaid is likely the primary target. House Speaker House Ryan recently said Medicaid is the “entitlement” program that is the cause of deficits. How many times do we have to live through eras of the rich getting richer on the backs of the middle-class and low-income individuals and families?
This bill and the justifications given for it make no sense. The country’s economy has been on the rebound since the mortgage lenders’ greed, fueled by Wall Street, sent us into the Great Recession. Economic growth has been consistent since the end of Obama’s first term, and heated up during the second. Obama, despite Trump’s rhetoric, left us with a growing economy, and with a healthier country. Because of the ACA and its expansion of Medicaid, which Trump now derides, the country has the lowest uninsured rate in more than 50 years. In fact, during his campaign for the White House, Trump lauded Medicaid, conceding it was a much-loved program. (And indeed, it is, as seen in research from the Kaiser Family Foundation.)
Coming a few short years after the bailout of Wall Street necessitated by the housing collapse it caused, the Republican Party and its president are plotting to reward the kings of Wall Street with lower tax rates, and for reasons that defy logic. Although economic growth has been on fire, corporations have reaped the greatest benefits of strong, consistent economic growth. Now, in this period of strong economic growth, mostly for corporate America, the Republican Party is willing to send the national deficit soaring to give the powerful even more. Shame on the moderate Republicans who play along with this plan.
And there is even more harm in this bill. How ironic, for a president who campaigned on a promise to help the middle class, that he and his Republican allies are still seeking to weaken a popular health care law that is lifting up Americans and helping to put more people to work. In addition to setting the stage for Medicaid cuts, the tax plan includes a specific provision to repeal the integral enforcement provision of the ACA, thereby endangering the health care coverage of many of the 24 million Americans who gained insurance because of the landmark health care law.
There are widespread demonstrations mounting against the Trump tax measure, as there should be. But the outcry over this atrocity has been building slowly because of Republicans’ masterful efforts in dispatching transparency and muzzling debate in their effort to pass this legislation as quickly as possible, before the Republican majority in the Senate shrinks in a few short weeks from now.