The Republican "Wealth-fare" Tax Framework

Republicans, led by their neo- fascist swindler- in- chief Donald "Rump" Trump, unveiled an outline of their "tax reform" proposal yesterday. Hopefully, it won't shock you to learn it was (as Sen. Schumer put it) "wealth-fare," loaded with yuuuge breaks for corporations and the well- to- do.

Here's a breakdown by Karoli Kuns at Crooks & Liars about what the Republican "wealth- fare" proposal would do:

1. Drop the number of personal tax brackets from seven to three: 12%, 25% and 35%... [T]his is "smoke and mirrors" because it doesn't effect prosperity, which is the justification Trump and the Billionaires use for tax cuts.... [F]ewer people will pay the highest rate, but they'll raise the lowest rate so that more people are paying more taxes. Socialize the cost; privatize the profit. It's how Republicans roll. 

2. Double the standard deduction to $12,000 for individuals, $24,000 for married couples. This is how they get around raising the lowest rate from 9.7% to 12%. It also supposedly gets rid of the marriage penalty and raises the tax credit for having lots of children, along with granting a whopping $500 tax credit for non-child dependents. 

3. Repeal the estate tax - We all know who derives benefit from this. 

4. Repeal the alternative minimum tax instead of fixing the indexing so that it doesn't catch middle-income earners in its grasp. Most people don't pay this. If it were properly indexed, it would tax high earners at a rate more appropriate for people who already have too much money. 

5. Drop the corporate tax rate to 20% which Trump claims is what he wanted all along, not 15% like he's been insisting upon. 

6. Drop the rate on "pass-through" (Subchapter S) corporations to 25%. Republicans swear this will help the mythical "small businesses" which are being terribly hammered by the higher tax rate, but the average income pass-through on these entities is $750,000. They don't need a tax break. They need to pay more.

Oh, and it would balloon the deficit by trillions of dollars, something Republicans only care about when a Democrat is in the White House.

The New York Times editorial board has more detail on the Republicans' "boondoggle masquerading as tax reform:"

After months of secret negotiations, the Trump administration and congressional leaders have come up with a tax plan — sort of. What they have really come up with is a wish list of tax cuts for the wealthy, with lots of “we’ll get back to you on that” promises where the details are supposed to be. 

This much is clear: The tax “framework” published by Republican leaders on Wednesday would greatly increase the federal deficit, would not turbocharge economic growth and could leave many middle-class families worse off by ending deductions they rely on. It would do little or nothing to improve the lot of the working class, a group President Trump says he is fighting for. It would instead provide a windfall to hedge fund managers, corporate executives, real estate developers and other members of the 1 percent. And can it be just a happy coincidence that Mr. Trump and his family would benefit “bigly” from this plan? [snip]

It’s hard to predict the economic impact of these skeletal proposals. But most experts agree that they could raise the federal budget deficit by trillions of dollars. As they have so many times in the past, Republicans will surely argue that the cuts would spur growth, and, in some measure, pay for themselves. This is the old supply-side hooey. In fact, over time the increased borrowing for unproductive tax cuts could depress growth by driving up interest rates. 

There are important public purposes that could justify increasing the deficit — repairing the country’s dilapidated infrastructure, for instance, or paying for hurricane recovery efforts. Making the rich richer is not one of them. 

(The editorial contains some useful graphics on historic marginal tax rates and the Alternative Minimum Tax - please check out the entire op/ ed.)

Once again, as with their Obamacare repeal efforts, Republicans don't seem to care about what the people want, or know that the public is on to them:

Cutting corporate taxes looks like a hard sell for Donald Trump and Republican Party leaders -- a new ABC News/Washington Post poll shows that 65 percent of Americans feel large corporations pay too little in taxes. 

Given what the public knows about it, they opposes Trump’s tax plan by 44-28 percent, with a substantial 28 percent undecided. Half of those polled expect the administration’s plan to reduce taxes on the wealthy, while just 10 percent think it’ll reduce taxes on the middle class. A quarter expect equal treatment.

We'll have more as this "boondoggle masquerading as tax reform" gets fleshed out.  But we'll leave you with an editorial cartoon we posted a few days ago that sums it up now and forever:

(click on image to enlarge)


(Tom Toles, Washington Post)

Tweets Of The Day: The Cure-All

Trump tells cabinet Hurricane Irma means wealthy need their tax cuts faster https://t.co/d8DySxFnVn

— #TheResistance (@SocialPowerOne1) September 10, 2017

Hurricanes are the Lord's way of saying rich polluters need fat tax breaks. https://t.co/PmQISqYLYu

— LOLGOP (@LOLGOP) September 9, 2017

You almost get idea that entire GOP economic philosophy is dependent on a never-ending stream of tax cuts for rich.  https://t.co/EnfF7yVTfK

— Jennifer Rubin (@JRubinBlogger) September 10, 2017

Trump is an independent now. Also he wants to leverage human suffering to pass a large tax cut for millionaires.

— Matthew Yglesias (@mattyglesias) September 10, 2017

What the victims of Harvey and Katrina most want is a huge corporate income tax cut. pic.twitter.com/f4KG8QkPci

— Matthew Yglesias (@mattyglesias) September 10, 2017

Trump Budget Slashes Medicaid, Social Safety Net Programs

"Populist" hero and world- class con man Donald "Rump" Trump is proposing a cut of $800 billion in Medicaid as well as other social safety net programs over the next 10 years ($1.7 trillion in all). His 2018 budget proposal lays the basis for using cuts to Medicaid and the Supplemental Nutritional Assistance Program (SNAP) to balance nearly $1 trillion in tax cuts mostly benefitting the wealthiest Americans (i.e., via the TrumpCare abomination). But these proposals are just the beginning of the income redistribution upward:

The proposed changes to Medicaid and SNAP will be just some of several anti-poverty programs that the White House will look to change. In March, the White House signaled that it wanted to eliminate money for a range of other programs that are funded each year by Congress. This included federal funding for Habitat for Humanity, subsidized school lunches and the U.S. Interagency Council on Homelessness, which coordinates the federal response to homelessness across 19 federal agencies.

This, as part and parcel of the longstanding effort by Republicans to destroy affordable health care and the social safety net in this country, must be a petard on which their heads should be hoisted, hopefully starting in Montana on Thursday (where Democrat Rob Quist is hammering on affordable health care), then on to Georgia on June 20 (where Democrat Jon Ossoff is hanging Rump around his opponent's neck).

Voters who support Republicans might want to think about this:

I wonder how many Trump voters plan on taking in their elderly parents when these cuts go through? https://t.co/67NXe5qXNh

— Bruce Bartlett (@BruceBartlett) May 21, 2017

Sunday Reading

Carlos Barria / Reuters

As always, please follow the link to the full reads.

Adam Gaffney is a critical care physician. He knows the Republican TrumpCare bill is more about tax cuts for the wealthy than anything else:

Let us imagine that you would like to redistribute hundreds of billions of dollars from working class people to the rich, and wouldn’t hesitate to risk the lives of tens of thousands of people to do so. Well, as luck would have it, there is a bill— the “American Health Care Act” (AHCA)—that does precisely that. [snip] 

Together with savings from having less adequate, skimpier insurance subsidies, these reductions will allow hundreds of billions of dollars to be channeled to the wealthy and corporations in the form of tax cuts. 

By enriching the rich in this manner, the AHCA would leave an estimated 24 million more uninsured by 2028. Similar calculations have already been done, but it’s worth briefly revisiting the blood-arithmetic on this.  

Colleagues of mine recently reported estimates, in the American Journal of Public Health, of how many newly insured people there would have to be to prevent one death per year. These estimates, which, being estimates, aren’t perfect, were based on five studies. The numbers ranged from 300 to 1,239 people.  

If we were to pick a round number on the conservative end of that range – say 1,000 – we would estimate that stripping insurance from 24 million people would produce an estimated 24,000 additional deaths annually. That is 40% more than the sum total of all murders, estimated by the FBI at 14,429 for 2014 (using somewhat different numbers, Vox’s Julia Belluz makes this point and comes to the same figure).

Now, in all fairness to House Republicans, as a critical care physician, I too get blood on my hands when I go to work. The only difference is I can wash mine off. [snip] 

This execrable, homicidal bill must obviously be stopped. But that’s not all we must do. The most enduring defense against the rightwing saboteurs is not continued championship of a flawed status quo, but instead the promise of a better tomorrow: healthcare for all, through a single-payer universal system. That alone will put an end to these deadly assaults on healthcare. 

A Republican's idea of great legislation combines tax cuts for the wealthy, afflicting the afflicted, and systematically dismantling the Obama legacy. This POS bill hits the trifecta.

Warren Buffet is an extremely wealthy man. He also knows the Republican TrumpCare bill was written just for people like him:

May 6 Berkshire Hathaway Inc Chairman Warren Buffett on Saturday fumed that healthcare costs are eating away at the U.S. economy like "tapeworm" and said the Republican approach to overhaul Obamacare is a tax cut for the rich. 

The U.S. House of Representatives on Thursday narrowly approved a bill to repeal and replace Obamacare, a victory for Republican President Donald Trump who has called the 2010 law a "disaster." 

Speaking at Berkshire's annual shareholders' meeting in Omaha, Buffett said his federal income taxes last year would have gone down 17 percent had the new law been in effect. 

"So it is a huge tax cut for guys like me," he said. "And when there's a tax cut, either the deficit goes up or they get the taxes from somebody else." 

E.J. Dionne agrees that this abomination will define Republicans, to their everlasting detriment:

We should never forget May 4, 2017. 

It should forever be marked as the day when the House of Representatives descended to a new level of cruelty, irresponsibility and social meanness. 

The lower chamber has always claimed to be “the people’s house.” No more. It should now come to be known by other names: the house of selfishness, the house of suffering, the house of the wealthy, the house of expediency, the house of untreated illness. Perhaps also: the house of Trump. [snip] 

“This is who we are,” Ryan told his colleagues this week. “This will define us.” 

Yes, it will. [snip] 

And then there is President Trump, who has absolutely no idea what’s in this bill and couldn’t care less. He hailed a measure that dumps people off the insurance rolls by saying that “we will have great, great health care for everyone in our nation.” And then he praised the Australian health-care system, which covers everyone and is the antithesis of the bill he had just praised. 

For the benefit of this empty man, House Republicans, you just sold your social consciences [ed.: puhleeze, they never had social consciences].

The Congressional Budget Office is expected to come out with its official scoring of this atrocity in the coming week. It will lay out the cold facts of this atrocity's impacts, which will have only become worse since the scoring of TrumpCare 1.0.  For now (and into the future), expect much more of what Sen. Chris Murphy observes about Republicans:

In 20 years in public service, I have never seen the level of bald faced, intentional lying that is happening right now. https://t.co/rdp0R83wb0

— Chris Murphy (@ChrisMurphyCT) May 4, 2017

(Photo:  Let this image of Republicans celebrating bringing misery to average Americans in order to deliver tax cuts for the wealthy be imprinted on your brain.)

Today's Cartoon - "An Elephant Never Forgets"

It wasn't easy finding an editorial cartoon today that wasn't in some way about the treasonous Trump - Putin bromance, but in the interests of variety, here's Tom Toles on what motivates Republicans in their obedience to Trump:

(click on image to enlarge)


(Tom Toles, once great Washington Post Bezos Bugle)

No doubt something will trickle down on The Forgotten Man!  As Jon Chait put it in regard to Congressional Republicans led by Rep. Paul "Lyin'" Ryan (R- Galt's Gulch):

Liberals have been saying that the Republican Party is going to be held together by a devils’ bargain, in which Trump gives Ryan his core economic agenda, and Ryan gives Trump a free hand to corrupt American government as he sees fit. What’s amazing is that Ryan is now basically saying the same thing.

Republican Tax Breaks: "So Much For So Few"

As Americans well know, today is the deadline for filing tax returns.  (By the way, anyone reading this who has had delays in getting assistance or having questions answered by the Internal Revenue Service should read this.)  Death and taxes, the Great Levelers -- or not so much if the bill endorsed by media-designated genius wonk Rep. Paul "Lyin'" Ryan (Galt's Gulch-WI) gets enacted (spoiler alert:  it won't).  Here's frequent blind squirrel Dana Milbank:

Give credit to Republicans in Congress.

They’ve discovered, belatedly, that income inequality is a problem, and they’re no longer proposing to give tax breaks to the wealthiest 2 percent of Americans. Now they are proposing to give tax breaks to the wealthiest two-tenths of 1 percent of Americans.

On Tuesday afternoon, the House Rules Committee took up H.R. 1105, the “Death Tax Repeal Act of 2015,” with plans to bring it to a vote on the chamber floor Wednesday — Tax Day. It is an extraordinarily candid expression of the majority’s priorities: A tax cut costing the treasury $269 billion over a decade that would exclusively benefit individuals with wealth of more than $5.4 million and couples with wealth of more than $10.9 million.

That’s a tax break for only the 5,500 wealthiest households in the country each year, according to the Joint Committee on Taxation. Of those, the 318 wealthiest estates each year — those worth $50 million or more — would see an average windfall of $20 million each, according to the Center on Budget and Policy Priorities. (our emphasis)

As the op/ed goes on to explain, the Republican talking points that the "death tax" (or as normal people call it, "estate tax") represents double taxation and a "devastating" hit on small businesses and family farms are, as one should expect, preposterously bogus. Meanwhile, they would be opening the Treasury for an average windfall of $20 million for each of the 5,500 wealthiest households, the shortfall largely coming from cuts to programs for the middle class and poor (Medicaid, food stamps, etc.).  In other words, your typical discredited trickle-down, makers vs. takers Republican philosophy untethered from, and antagonistic toward, the real world.

(Image:  Buff Bro' Ryan, still pumping out the tax breaks for the ultra-rich.)

Paul Ryan's Most Pressing Issue: Cutting Taxes On The Wealthy

Ayn Rand admirer and soon-to-be-Chairman of the House Ways and Means Committee (!) Rep. Paul "Lyin'" Ryan (Galt-WI) has told the right-wing rag the "Weekly Standard" that he thinks cutting the top marginal tax rate for wealthy Americans is an "even more pressing" need than it was in the reign of St. Ronnie of Hollywood, who cut it from 50 percent to 28 percent.

Because we don't have enough income inequality?  Or is this his way of addressing his "new focus" on poverty?

No, he's just showing his long-standing, true colors to his fan base of "Makers," whose philosophy of economic Darwinism drives their Republican Party's failed "trickle down" policies.  It's precisely the wrong formula for a healthy and prosperous middle class, which is the true driver of economic growth.

"Mathematically Impossible"

Middle class tax increase. That's the conclusion that must be drawn from outsourcing pioneer Willard "Soak the Middle Class" Romney's reverse Robin Hood tax policy, as discussed by Ezra Klein today. The non-partisan Tax Policy Center conducted an exhaustive evaluation of Willard's plan to cut taxes for millionaires while purportedly reducing the deficit. They tried to give the plan a fair shake, but as Klein notes,

"The numbers never worked out. No matter how hard the Tax Policy Center labored to make Romney’s promises add up, every simulation ended the same way: with a tax increase on the middle class. The tax cuts Romney is offering to the rich are simply larger than the size of the (non-investment) deductions and loopholes that exist for the rich. That’s why it’s 'mathematically impossible' for Romney’s plan to produce anything but a tax increase on the middle class." (our emphasis)

Willard's campaign response? No rebuttal, just trying to smear the messenger, whom the campaign had earlier praised for its "objective, third-party analysis." As Klein continues,

"The Romney campaign has not provided good answers to the questions raised by its own math. But we already knew the Romney campaign didn’t have good answers. If Romney had good answers, he would have made good on his rhetoric and put his plans on the table."

I think that's another way of saying "Put up or shut up, Willard."

Rethug Tax "Reform:" Reverse Robin Hood

A study by Senate Democrats and reviewed by non-partisan tax experts, shows that the effect of the Rethuglican's tax "reform" plan would be raising much larger taxes on the middle class while sharply cutting taxes for the wealthy. It would also reduce federal tax revenues by $4.5 trillion over the next decade, exacerbating the deficit issue that the Rethuglicans and other squirrels claim is so important to address ("Austerity!"). (To see the best graphic of the impact of the tax "reform" plan, be sure to click on the chart in the linked article.) You couldn't find a starker example of the "reverse Robin Hood" Rethuglican/ Ayn Rand philosophy that the "productive" (a.k.a., the "wealthy," the "job creators") are to be rewarded with more wealth at the expense of a shrinking and declining middle class. You also couldn't find a starker contrast with what the Democrats believe and fight for.

"We Don't Pay Taxes, Only The Little People Pay Taxes"

Those were the infamous words of the late "Queen of Mean" hotel mogul Leona Helmsley, and they're largely true today. On this tax day, it's worth noting that the value of the budget cuts in 2011 ($38 billion) is exceeded by the value of the tax cuts on the wealthiest Americans ($42 billion) -- so the cuts in domestic programs actually did pay for tax cuts for the wealthiest Americans after all. But don't weep for them: they have the Rethuglican / New Confederate Party under contract to protect their interests. And they've been doing quite well, thank you very much.

Your tax dollars -- and Rethuglican politicians -- at work.

(photo: The late Leona proves that the face can be a window to the soul -- or lack thereof)

Grayson on Tax Cuts for the Millionaires

We're going to miss Alan Grayson in Congress. Hopefully, he'll be back in 2012.

Will The Dems Act on Taxes?

It seems that the Dems never miss an opportunity to miss an opportunity. One of the messages that President Obama has been hitting hard is that the Rethugs in Congress are holding middle class tax cuts hostage to their desire to give tax cuts to the top 2% income earners. But Congressional Dems seem to be reverting to their normal mode of hand-wringing and cowering. TPM is reporting that there's a split in the House leadership over whether to vote on a measure to eliminate the Bushit tax cuts for the wealthiest Americans. Here's an issue that will only make the Rethugs look bad and the Dems look good, but the Dems lack the political sense, guts and unity to act. . . for now, at least.

The Rethugs have long had protection of the wealthiest Americans in their DNA (see FDR's references to the Rethugs if you have any doubt). If the Dems give them cover by avoiding a vote, they have given away a golden opportunity to remind voters who the Rethugs actually represent.