By Thomas Kennedy
The Republican Party just tried a massive redistribution of wealth from the poor to the rich through the repeal of the Affordable Care Act. The resulting tax cuts would have given $600 billion to the wealthiest of Americans at the expense of leaving 24 million Americans uninsured over the next ten years.
That plan was so asinine to members of Congress that the moderate wing of the Republican Party rejected it due to fears of the electoral repercussions in the 2018 midterm elections. Unfortunately for working class families, the Trump administration’s tax plan proposal would result in trillions of dollars worth of tax cuts for the wealthy while increasing burdens on low income and middle class Americans.
Mitt Romney infamously said during his 2012 campaign “corporations are people my friend”. The Trump tax plan takes that sentiment to a whole new level. To start off, the Affordable Care Act tax which applies to people who earn over $200,000, and the Alternative Minimum tax which applies to the richest of Americans would both be eliminated.
The individual tax rate would be reduced from 39.6% a year to 35% and that change would only apply to those making $400,000 a year. The corporate tax rate would be reduced to 15%.
All in all the non-partisan Committee for a Responsible Federal Budget estimates that this tax plan could end up costing the United States $7 trillion dollars over the next ten years. That would constitute a third of our annual GDP.
To put that into perspective as to how that money could be better spent, Senator Bernie Sanders proposed a bill which would abolish tuition at public universities for students from households making up to $125,000, and would make community college tuition-free for all students. That proposal was estimated to have cost tax payers $47 billion annually.
Another popular proposal which has a 64% approval rating is a Medicare for all system of universal healthcare for Americans. Ensuring healthcare for all would cost the United States $2.3 trillion a year (We currently spend $2.8 trillion under the current system).
Instead of fighting for proposals that would make life easier for working class families, Trump and Congressional Republicans want to continue implementing trickle down economic policies that ensure that wealth stays at the top and never makes its way down to grow the middle class.
The question that Americans should be asking themselves is how will the Trump administration pay for a tax plan that is equivalent to a third of our yearly GDP net worth? The answer is by cutting programs that everyday Americans rely on to get by in their daily lives.
We have already seen how the Trump administration wanted to cut Meals on Wheels, a program which ensures that senior citizens with mobility difficulties don’t go hungry but the cuts don’t stop there. The Senior Community Service Employment Program, a job training program for low-income people 55 and older, is to be completely eliminated.
In similar fashion, dozens of programs which help low income Americans would be dismantled. Legal Services Corp, a 43-year-old congressionally chartered organization that helps provide free civil legal advice to poor people would suffer the same fate. The 21st Century Community Learning Centers supports before and after school and summer programs, helping working parents. The current administration does not take their difficulties into account.
The need for tax reform is real. The tax code is needlessly complicated and riddled with loopholes that allow the richest in our society to not pay their fair share. Unfortunately the tax plan proposed by the Trump administration only exacerbates those problems.
Thomas Kennedy is a writing fellow for the Center for Community Change.