Tag: Tax Policy

“One thing you can count on in 21st-century U.S. politics is that Republicans will lie about taxes. They did it under George W. Bush, they did it under Barack Obama and they’re still doing it under Donald Trump.

Yet this time is different. It’s not just that the lies have gotten even more brazen. There’s now a combination of incoherence and rage that we, or at least I, haven’t seen before. These days, they can’t even seem to get their fake story straight — and they literally start yelling obscenities when someone tries to point out the facts.

G.O.P. lies about taxes generally involve two issues: who is hurt or helped by tax changes, and what these changes will do to the budget.

Thus, when George W. Bush cut taxes in 2001 and 2003, he and his party repeatedly insisted that the tax cuts were primarily for the middle class. In fact, while there were some middle-class tax breaks in the package, such as an increase in the child tax credit, these were dwarfed by cuts in tax rates on high incomes, reduced taxes on dividends and repeal of the estate tax. Over all, the richest 1 percent saw a much larger increase in after-tax income than middle-class families did.

At the same time, the Bush administration used a series of gimmicks to hide the true fiscal cost of the plan, such as delaying the implementation of some tax cuts while pretending that others would expire when the actual intention was to make them permanent.

When Obama took office, these tricks were simply flipped on their head. Republicans insisted, falsely, that Obama had imposed a “massive tax increase” on the middle class; in fact, for the most part he actually cut middle-class taxes. Meanwhile, they insisted that the surge in the budget deficit caused by the aftermath of the 2008 financial crisis was permanent, and ridiculed the Obama administration’s claims that deficits would fall sharply once crisis spending ended and tax receipts recovered; in fact, that’s exactly what happened.

So what’s different this time? As in the Bush years, Republicans are claiming to be offering a middle-class tax cut. But where Bush truly was cutting taxes on the middle class, just much less than he was on the wealthy, current Republican plans would raise those taxes on many lower- and middle-income families, even as they go down for the wealthy. (Steven Mnuchin, the Treasury secretary, claims that only “million-dollar earners”would see tax increases. This is the opposite of the truth.

Oh, and a memo to journalists: If you play it safe by reporting this as “Democrats say” that middle-class taxes will go up, you’re misleading your readers: Those estimates come from the Joint Committee on Taxation, Congress’s own nonpartisan scorekeeper.

How can Republicans like Paul Ryan, the speaker of the House, pretend to be helping the middle class? It depends crucially on a new kind of budget gimmick: Both the House and Senate tax-cut bills do contain some middle-class tax breaks — but only for the first few years. Then they expire.

Take one of Ryan’s favorite examples, a family with two children and earning $59,000 a year. That family would indeed get a tax break next year. But the break would rapidly dwindle and turn into a tax increase by 2024.

The Republican response is to claim that these tax breaks wouldn’t really expire, that Congress would eventually renew them. That’s quite doubtful — and even if true, it means that the tax plans would add much more to the national debt than the G.O.P. admits. Which brings me to the whole budget deficit issue.

Not long ago, leading Republicans claimed to be deeply concerned about budget deficits. Only fools and centrists took the Republicans seriously. Still, the abrupt shift to nonchalance about adding trillions to the debt in order to cut taxes on corporations and the wealthy is causing a bit of whiplash even among cynics. How do they justify the shift?

Well, they don’t seem to have settled on a story. Mnuchin keeps asserting that tax cuts will pay for themselves, going so far as to claim (falsely) that Treasury has released a study showing this. Mick Mulvaney, the budget director, cheerfully acknowledges that they’re using gimmicks to pass a bill that permanently cuts taxes on corporations, and not to worry. Whatever works, it seems.

So we’re really looking at an unprecedented level of dishonesty here. But what happens when you try to explain what’s going on? When Senator Sherrod Brown tried to point out, correctly, that the Senate G.O.P.’s tax bill heavily favors the rich, Senator Orrin Hatch exploded, calling it “bull crap” and asserting that he grew up poor (which is relevant why, exactly?).

Sorry, but this isn’t the righteous anger of a man falsely accused of wrongdoing. It’s the rage con men always exhibit when caught out in their con.

But what’s the con about? The very incoherence of the arguments Republicans are making for their plans shows that it’s not about helping the economy, let alone ordinary families. It really is about making the rich richer, at everyone else’s expense. If this be bull crap, make the most of it.”

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As usual, the GOP counts heavily on voters being too biased or gullible to figure out that they are being fleeced. And, to date, they have been correct. So, why stop a “winning strategy” even if it is based on lies, demonstrably bogus assumptions, and other “cons?”

PWS

11-21-17