The Republican tax plan that slithered out of the Senate last week is such an avalanche of horse apples that even the Trumpiest of Kool-Aid drinkers ought to be clutching their chests in panic. Over the life of the plan workers earning between $40,000 and $50,000 a year will pay $5+ trillion more in taxes while those earning $1,000,000 or more will pay $5+ trillion less. If Republicans had an honest campaign slogan it would be, “Let them eat cake!”
President Trump, House Speaker Paul Ryan, and Senate Majority Leader Mitch McConnell – bigly deficit hawks, bigly, bigly – also claimed that a robust and thrilling economy would erase any “temporary” deficits produced by their tax plan. “We believe,” said Ryan, “that we’re there in the sweet spot, with economic growth that gives us more revenue with where we need to be.”
They are either lying or possess the reasoning and logic powers of preschoolers playing My Little Pony games in a back bedroom.
There is no credible evidence – none – to support their contention that tax breaks for corporations will result in enough expansion of taxable earnings to offset a rise in the debt-to-GDP ratio from the current 76% to 97% in 2027. To avoid that, Congress will need to cut spending by 21% in 2025. If defense spending cuts are off the table, then discretionary spending will need to be cut by 82%, or Medicare and Social Security spending by 41%.
There are only two political outcomes under this tax plan. Republicans have taken care of their fat cat donors, and they’ve stuck Democrats with gut-wrenching government spending cuts if Democrats win the White House in 2020. Maybe that was the goal all along.
The Obama economy ended on October 1 with the end of the federal fiscal year. The Trump economy is now 67 days old. Whatever happens to the economy from now on is on Republicans, on Old Marmalade Brains –and on the voters who put them in office. Be sure to thank them when your employer starts shoveling money your way. I mean, they promised it would happen. Just wait.