Opinion: Five crucial points on tax reform

 

With the great tax-bill unveiling about to take place, here are five major points to keep in mind:

1.) The GOP plan is predicated on the claim that American corporations are so overtaxed that they can no longer turn a sufficient profit or compete internationally, and that investors lack the incentive to invest. That’s the justification for dropping the current top corporate tax rate of 35 percent all the way down to 20 percent, with little effective effort to close loopholes.

That claim is pure, self-serving myth. Here’s the reality:

The reality is that since the turn of the millenium, corporate AFTER-TAX profits have quadrupled from already historic highs. To put it mildly, that does not suggest a corporate sector strangled by overtaxation. That huge surge in corporate profitability explains why the stock market is so high. It’s why corporate CEO pay has soared into the stratosphere. And this stunning increase in corporate AFTER-TAX profitability has been achieved in large part by ensuring that workers get a smaller and smaller share of the nation’s economic output. Nothing in the bill attempts to change that. To the contrary, and as we’ll see below, every independent analysis predicts it will concentrate ever more wealth in the hands of the richest 1 percent.

(As Steven Rosenthal of the Tax Policy Center also points out, 35 percent of the benefits of that corporate tax cut will accrue to foreign investors, not to Americans.)

2.) By their own admission, the Republican tax plan will increase the national debt by $1.5 trillion in the next decade. Nonpartisan analysts such as the Tax Policy Center put the number at more like $2.5 trillion. Those increases are over and above the substantial debt increases that are already baked into the nation’s financial cake, increases that Republicans have previously depicted as posing a serious, even existential threat to the American economy.

Put another way, Republicans want to pile an additional 1,500,000 million dollars to 2,500,000 million dollars on top of a debt that was supposedly already unsustainable. In their giddy, irrational exuberance, they show not the slightest bit of concern about doing so.

3.) The debt increase would be substantially worse if not for the $1.4 trillion that the GOP plan cuts over the next decade from Medicare and Medicaid, just as the baby-boom generation moves into its retirement years. Put simply, the GOP tax bill robs Peter to pay Paul, and the Peter being robbed is everyone who depends on government programs — children, the elderly, the disabled, those in nursing homes — to help pay their medical bills.

The Paul being paid is those already in the top 1 percent.

4.) Speaking of which:

“Taxpayer groups in the bottom 95 percent of the income distribution would see modest tax cuts, averaging 1.2 percent of after-tax income or less,” predicts the Tax Policy Center. “The benefit would be largest for taxpayers in the top 1 percent (those making more than $730,000), who would see their after-tax income increase 8.5 percent.”

By 2027, the TPC estimates, the top 1 percent would be collecting 79.7 percent of the benefits of the tax cuts. These numbers may change marginally once we are allowed to see actual legislative language that can be plowed back into economic models, but the overall thrust is clear.

5.) This major tax reform is being handled in much the same fashion as the GOP’s attempt to repeal and replace Obamacare. It has been written in secret, without the participation, input or knowledge of Democrats or even of most Republicans. There have been no hearings, no transparency, no outside input. And while the Obamacare repeal effort attempted to transform one-sixth of the nation’s economy with very little oversight, this effort would affect 100 percent of the economy. The Republican plan is to pass the still-unseen bill in the House by Thanksgiving, which is now three weeks away.

The last major rewrite of the tax code, in 1986, took more than two years hundreds of hours of open meetings to hammer out. The rush to unveil and pass this bill so quickly tells you a lot about its drafters’ confidence in its ability to withstand scrutiny.

Reader Comments 0

5121 comments
gotalife
gotalife

There is no motive for the last two massacres.


Americans are free to go out with a bang.


td1234
td1234

Steve Moore (Law enforcement analyst) on CNN stated it is orthodox of most mass shooters that they continue to shoot until they are confronted with a weapon and then they usually either flee or kill themselves. 

Eye wonder
Eye wonder

@td1234


What's your view on reports that Flynn and his son are going to get indicted?


Oh, and CNN = "fake news."  Real lame, tiny.

td1234
td1234

@JKToole @td1234 Nope but the progs on this blog would have said I was lying if I had not documented a so-called expert source on a prog station. 

DebbieDoRight
DebbieDoRight

Notice he said, "Come to power"; not "win the election".

Freudian perhaps?

Eye wonder
Eye wonder

 With all of the thoughts and  prayers that have been sent up in response to the many people who have been massacred by guns, you'd think people would start to wise up to the fact that maybe the thoughts and prayers aren't worth a damn thing????

gotalife
gotalife

@Eye wonder It is for the weak that believe in fairy tales but they are free to believe in anything.

Brosephus
Brosephus

@Eye wonder
When you pray to God for a solution, and God sends you one in response.  Is it his fault that you refuse his suggestions and continue to pray for the same thing time and time again?

Kamchak
Kamchak

@Eye wonder 

I was taught to pray for understanding, and not wishes. It seems that god has been turned into Santa Claus.

Paul42
Paul42

@Brosephus
"Pray like everything depends on God.  Then act like everything depends on you."

gotalife
gotalife

My neighbor is a preacher and his church is a block away.


Lots of churches down here.

LilRichie
LilRichie

@InTheMiddle2 @DebbieDoRight Maybe, not for certain, but just maybe there's a chance a thorough criminal and mental background check would have shown a red flag.

Nick_Danger
Nick_Danger

@InTheMiddle2 @DebbieDoRight 

I don't think ONE law would do the job.  But I'm not content to say, "oh well, massacres are the price we pay for freedom" and just give up, either.

Let's start with mandatory safety training certified before purchase of a weapon. 

Background check mandatory before purchase of a weapon. 

Fingerprint locks mandatory on all newly manufactured weapons. 

Step by step...

gotalife
gotalife

They recorded the church service and usually posted to Youtube but not this service. It is all on video.

rimsky
rimsky

Why do we need target practice when you possess a semi auto?

Bolt action I can understand.

InTheMiddle2
InTheMiddle2

@rimsky You can still miss with a lot of bullets just as easy as with a few. 

Kamchak
Kamchak

@rimsky 

Like most hobbies, people get enjoyment out of participation.

stefpe
stefpe

@rimsky For one, "spray and pray" doesn't seem like a very viable approach to deer hunting.

Brosephus
Brosephus

@rimsky

Can't answer for others, but I prefer precision shooting to simply just flinging lots of lead downrange and hoping that something hits.

I have always been a precision shooter, and I've been able to do special assignments because of my shooting.  I'm not the best, and I can always use more practice to get better.

There is a distinct difference, however, between shooting at a stationary paper target as opposed to a moving person who is shooting back at you.

rimsky
rimsky

 As vigils for the dead took place, US President Donald Trump, who is visiting Japan, offered condolences and told reporters on Monday: "We have a lot of mental health problems in our country, but this isn't a gun situation."

Speaking of mental health Donnie we have serious reservation about your and since you're in South Korea.......

TetoLeo
TetoLeo

Charging large taxes upon bullets would also have a side effect of gun owners being less safe and accurate owners. If the bullets cost more there will be less target practice and/or training. This leading to lawful gun owners who are not tactically prepared to fire their gun accurately, making them more dangerous.

rimsky
rimsky

@TetoLeo People go target practicing rarely.  Where I am at only we go to state park just before the deer season (rifle only) just to make adjustments to the scope

BuckeyeGa
BuckeyeGa

Maybe and maybe the perpatraitor is less likely to use a gun to commit a crime because the bullets are more expensive so the gun owner will have a better chance of defending themselves

Paul42
Paul42

@Brosephus
Excellent video, Brosephus.

I found myself thinking 'if some of our cons had bothered to watch it, their only reaction would be "what a bunch of dolts.  It that'd been meeeee that shooter would have been down in one second!"