Jim Hightower / Otherwords & Sen. Dianne Feinstein / Los Angeles Times & Richard Eskow / Campaign for America’s Future – 2017-12-07 22:52:35
http://otherwords.org/make-75000-lose/
If You Make Under $75,000, You Lose
Behind closed doors, Republicans admit that
their tax plan is all for their rich donor.
Jim Hightower / Otherwords
(December 7, 2017) — Sam Rayburn, a legendary speaker of the US House in the 1940s and ’50s, offered this piece of ethical advice for lawmakers who were conflicted over whether to vote for the people or the lobbyists: “Every now and then,” he said, “a politician ought to do something just because it’s right.”
How quaint! Today’s House speaker, Paul Ryan, has perverted Rayburn’s ethics, advising his Republican majority to vote for anything just because it’s right-wing.
Along with Donald Trump and Senate leader Mitch McConnell, Ryan is now trying to push America’s tax law so far to the right that it’s horribly wrong.
Tax proposals can be complex, but this 429-page monster is shockingly easy to understand: The Trump-Ryan-McConnell triumvirate intends to take money from millions of working families and give it to the world’s wealthiest people and richest multinational corporations.
Of course, when they talk publicly about their proposal, they claim it’s all about “helping” you working stiffs. It’s “real tax reform for everyday hardworking Americans,” trumpeted our president.
In private, though, they reveal to their biggest campaign donors that the plan lets them “help themselves” to the people’s money, giving these corporate elites a huge windfall — “the biggest ever,” bragged Trump.
In fact, the 400 richest families in America would average $5.5 million in new tax breaks. Meanwhile, if your income is under $75,000 a year, you’ll end up worse off.
Forget trickle-down economics — the GOP is practicing tinkle-down economics.
Why would they push such an evil, shameful policy? Because it’s not you common voters they care about. It’s the moneyed elites who fund their re-election campaigns.
As one Republican pusher of this tax giveaway, New York Rep. Chris Collins, put it: “My donors are basically saying: ‘Get it done or don’t ever call me again.'”
The Fight Against the GOP’s
Unfair Tax Plans Isn’t Over Yet
Dianne Feinstein / Los Angeles Times Op-ed
Half of American households will see a tax increase.
Meanwhile, billionaires and millionaires will pay less.
(December 4, 2017) — Tax reform shouldn’t add one penny to our deficit or to the tax bills of middle-class Americans. I thought that belief was shared by everyone in the Senate. It appears I was wrong.
Behind closed doors, Republicans drafted a bill that raises taxes on millions in the middle class and adds at least $1 trillion to our deficit. The bill also renews the GOP attack on the Affordable Care Act, a move that will drive up health insurance premiums in the individual market by 10% each year and will likely result in 13 million more Americans without coverage.
Refusing to hold a single hearing with outside groups, Republicans rushed their bill through the Senate in the hope Americans wouldn’t realize what it really is — a huge windfall for big corporations and the rich.
Every day, I hear from Californians worried about what this bill means for their family’s budget.
Raleigh is a middle-class retiree in Davis. He wrote that his taxes will go up nearly $4,000 a year and he can’t afford such a drastic tax increase on his fixed budget.
Mary lives in Berkeley. She said her health insurance premiums will rise because of the attack on the Affordable Care Act. The higher costs could force her to choose between buying health insurance or paying for her daughter’s college tuition.
And Carol, who lives in Sacramento, tells me her family’s taxes would go up almost $12,000 a year, making it harder for them to save for retirement.
Unfortunately, they’re not alone. Half of American households will see a tax increase. Meanwhile, billionaires and millionaires will pay less. That’s appalling.
Californians will be hurt the most by the partial elimination of the state and local tax deduction, known as the SALT deduction.
Since the national income tax was created in 1913, Americans have been able to prevent double taxation by deducting state and local taxes they have already paid. Approximately 6 million California households claimed this deduction in 2015.
This provision hurts all Californians, even those who don’t claim the deduction. Funding for critical services like schools, police and fire departments could be in jeopardy as communities try to ease the increased tax burden on families.
State and local governments won’t be the only ones feeling the squeeze. The massive trillion-dollar increase in our national deficit could later trigger cuts to vital programs.
Republicans are selling Americans a fairy tale — the false claim that these tax cuts for the rich will pay for themselves. That view isn’t shared by credible economists. According to Congress’ Joint Committee on Taxation, over the next decade, estimated growth under the plan would make up for no more than a fraction of deficit increases.
So I fear Republicans hid their true intentions.
In a few years, they’ll no doubt use the growing deficits they created as an excuse to gut Medicare, Medicaid and Social Security. Americans who rely on these programs will be victims of the Republicans’ partisan tax plan.
But one group is a clear winner in the bill. The tax rate for big corporations was cut almost in half, dropping from 35% to 20%. And they get to keep deductions taken away from ordinary people, theoretically allowing companies to drive their tax rate down further.
Think about that. A family of four can’t deduct many of the state and local taxes they pay, but a large corporation still could under the Republican bill.
Mary lives in Berkeley. She said her health insurance premiums will rise because of the attack on the Affordable Care Act. The higher costs could force her to choose between buying health insurance or paying for her daughter’s college tuition.
And Carol, who lives in Sacramento, tells me her family’s taxes would go up almost $12,000 a year, making it harder for them to save for retirement.
Unfortunately, they’re not alone. Half of American households will see a tax increase. Meanwhile, billionaires and millionaires will pay less. That’s appalling.
Californians will be hurt the most by the partial elimination of the state and local tax deduction, known as the SALT deduction.
Since the national income tax was created in 1913, Americans have been able to prevent double taxation by deducting state and local taxes they have already paid. Approximately 6 million California households claimed this deduction in 2015.
This provision hurts all Californians, even those who don’t claim the deduction. Funding for critical services like schools, police and fire departments could be in jeopardy as communities try to ease the increased tax burden on families.
State and local governments won’t be the only ones feeling the squeeze. The massive trillion-dollar increase in our national deficit could later trigger cuts to vital programs.
Republicans are selling Americans a fairy tale — the false claim that these tax cuts for the rich will pay for themselves. That view isn’t shared by credible economists. According to Congress’ Joint Committee on Taxation, over the next decade, estimated growth under the plan would make up for no more than a fraction of deficit increases.
So I fear Republicans hid their true intentions.
In a few years, they’ll no doubt use the growing deficits they created as an excuse to gut Medicare, Medicaid and Social Security. Americans who rely on these programs will be victims of the Republicans’ partisan tax plan.
But one group is a clear winner in the bill. The tax rate for big corporations was cut almost in half, dropping from 35% to 20%. And they get to keep deductions taken away from ordinary people, theoretically allowing companies to drive their tax rate down further.
Think about that. A family of four can’t deduct many of the state and local taxes they pay, but a large corporation still could under the Republican bill.
“Every Darn Penny”:
The GOP’s Philosophy on Death and Taxes
Richard Eskow / Campaign for America’s Future
(December 7, 2017) — Republican Senator Charles Grassley tells the Des Moines Register his party’s plan for deep tax cuts to the rich “recognizes the people that are investing, as opposed to those that are just spending every darn penny they have, whether it’s on booze or women or movies.”
Perhaps Sen. Grassley is replaying an old record from his youth. “Cigarettes, whiskey, and wild wild women,” sang the Sons of the Pioneers in 1947. “They’ll drive you crazy, they’ll drive you insane.”
So much for that newfound Republican populism we’ve been hearing so much about. So why, Senator Grassley, can’t we all just be rich, like you?
Every Darn Penny
Working people don’t have much to spend on entertainment nowadays, because it takes “every darn penny they have” just to survive. A recent survey found that 78 percent of Americans say they’re living from paycheck to paycheck.
More than one-third said they “sometimes” lived paycheck to paycheck, 17 percent said that “usually” did, and 23 percent — one in four — said they “always” struggled to make it from one payday to the next.
The CareerBuilder survey also found that “a quarter of workers (25 percent) have not been able to make ends meet every month in the last year, and 20 percent have missed payment on some smaller bills.”
In a related finding, a Federal Reserve survey from 2015 found that nearly half of all Americans said they would be unable to come up with $400 in cash to cover an emergency expense. As NBC News reports, these levels of financial insecurity can be harmful to a person’s health.
Making Inequality Worse
It’s not likely to get better any time soon. As the Pew Research Center found last year, the middle class is steadily disappearing all across the United States. And inequality will get worse under the tax plan Grassley promotes (1).
Economist Lilly Batchelder summarized that plan’s impact succinctly in a recent interview with Dylan Scott and Alvin Chang:
The bill is investing heavily in the wealthy and their children — by boosting the value of their stock portfolios, creating new loopholes for them to avoid tax on their labor income, and cutting taxes on massive inheritances.
At the same time, it leaves low- and middle-income workers with even fewer resources to invest in their children, and increases the number of Americans without health insurance.
As Scott and Chang note, this bill “would make America’s income inequality worse. Maybe a lot worse . . . .”
Frugality, Savings, and Investment
Grassley’s tin-eared comments sparked widespread outrage, and his attempts to contain the blowback didn’t improve matters. He said his remark had been “taken out of context,” adding that he was seeking “a tax code that doesn’t penalize frugality, saving and investment.”
But the estate tax only applies to assets greater than $5.5 million for individuals and $11 million for married couples. Even Grassley, a multi-millionaire who has held public office since 1959 yet likes to call himself a farmer, would dodge the tax. The only way it might imaginably affect his heirs, he told NPR, is if he and his wife were to die on the same day.
Estates of the size amassed by the Grassleys are rarely the result of “frugality, saving and investment.” Increasingly they’re likely to be the result of inherited wealth that’s been passed through multiple generations.
Grassley waxed lyrical about “parents saving for their children’s college education or working families investing and saving for their retirement.” But estates of $5.5 million or $11 million are not produced by “working families.”
At last reporting, the median household income in the United States was $59,000. It would take the typical couple more than 186 years to save enough to subject their heirs to any estate tax, even if they didn’t spend a penny of their earnings.
Philosophy Class
When Grassley evoked a “hundred-thousand-dollar income for two people” to NPR as a reason to support repealing the estate tax, the interviewer pointed out that “very, very few couples” in that category would ever leave estates large enough to be taxed. That led to this howler:
Listen, in no way is my statement meant to dispute the statistics you gave me. I’m giving you a philosophical reason for recognizing savings versus those who want to live high on the hog and not save anything or invest in the commodities.
“High on the hog”? There he goes again, claiming that struggling families fritter away their money watching those darned moving pictures.
But when you get frustrated with the GOP’s tin ear, remember Grassley’s advice, the one thing he said that may be true. Republicans aren’t lying when they say they believe their tax breaks for the ultra-rich and cuts to essential services are in the interest of working families. It’s their philosophy to reward those who need it least.
Live and Let Die
In another recent interview, Grassley repeated the Republican canard that income is taxed twice under the estate tax. This is nonsense. Yes, it’s possible that the deceased’s income was taxed, although wealthy people have access to a lot of tax avoidance techniques. But that income is not taxed a second time.
It is the heirs’ income that is taxed after death, not that of the person leaving the inheritance. In this sense, an inheritance is no different than any other income — a plumber’s fee, for example.
I pay income tax on my earnings. When I hire a plumber, she pays income tax on what I pay her. That money isn’t “taxed twice,” because a different person receives it each time.
Rep. David Young, an Iowa Republican, repeated another often-repeated GOP misstatement when he insisted that “death should not be a taxable event.” It isn’t. Neither the death nor the deceased are being taxed. The “taxable event” is the receipt of $5.5 million or $11 million by the heirs.
Sen. Grassley and his colleagues are likely to win the battle, but they may very well lose the war. It looks like they’ll pass their tax bill. But, despite all their focus-group tested talking points, the GOP is losing this debate in the public’s eyes.
The Republican tax bill remains extremely unpopular, according to current polls. Unless they can distract the public with other issues, they may pay a steep political price for it.
Apparently, voters know when Republicans are lying — excuse me, when they’re being philosophical — about taxes.
Footnotes
(1) As many observers have noted, the GOP bill is an act of class warfare. It gives half its cuts to the top 1 percent, raises taxes on 36 percent of working families, adds $71 billion to the cost of a college education; and provides additional privileges to wealthy individuals and special interests. (See Robert Borosage for more.) It would hurt education, as Jeff Bryant reports; damage small businesses and raise consumer taxes, as Tim Wilkins notes; and worsen our national housing crisis, as Liz Ryan Murray explains.
Richard (RJ) Eskow is a writer, a former Wall Street executive and a radio journalist. He has experience in health insurance and economics, occupational health, risk management, finance, and IT.
