More Trump Corporate Giveaways. Trillions Falling from Helicopters?

Retake has been criticizing the Democratic Party for accepting donations from the corporate sector and for advancing neoliberal policies that benefit their corporate and 1% donors. But neoliberalism is a bi-partisan affair and this post takes aim on Trump’s Tax Reform plan.

First, great news:  Gov. Martinez’s vetoes declared illegal.“This case was about computer science opportunities for school kids, economic development in agriculture, and defending the state’s constitution,” Speaker of the House Brian Egolf, D-Santa Fe, said in a statement. “Today’s ruling is a victory for our youth, our farmers, our communities and our constitution.” Click here.

Also, a reminder. Retake is holding a Town Hall Conversation with Richard Ellenberg on Saturday Aug. 19 from 3-5pm at the Center for Progress & Justice, 1420 Cerrillos. We will discuss the thinking behind a range of Democratic Party campaign practices and messaging and allow for an exchange of civil dialog about these issues. We will also explore ways in which this can be a starting point for ongoing, healthy conversation among fellow Democrats. Please RSVP either by clicking here to RSVP on Facebook or by email us at volunteer4retake@gmail.com.  For more information on the Town Hall click here.

 

Corporate Theft At Its Finest

After one of the posts last week, I was told by one mainstream Democrat that just because the Democrats are getting large contributions from pharma, from Wall St, and from other major corporate sectors, doesn’t mean that there is a quid pro quo, that Democrats would not take those donations then turn around and work to advance legislation that benefit those corporations. I don’t know about you, but I doubt that those highly profitable corporations achieved their profits by giving away money without purpose. And as this post makes clear, the corporations now have Trump and the GOP’s ear and are seeking massive cuts in corporate and personal tax rates. This is why it is so important that the Democratic Party cease from taking donations from these same corporations and tell its constituency that there is a difference between Democrats and Republicans and one of those differences is that they will cease taking money from corporations and will close loopholes, not create them.

Tax laws are not sexy or easy to understand and tax reform is an arcane process. As a result, it is often possible to insert seemingly benign changes in the tax law that are not really so benign at all. The Trump budget plan is full of changes that would save the 1% and large corporations trillions of dollars while shredding services and programs that benefit low-income communities. Before you get all righteous about Trump and the GOP, recall that under the Obama administration corporate profits were at their highest level since record-keeping began in 1929 and the effective corporate tax rate was lower than any point since Hoover was president. This slashing of tax rates for corporations and the rich has been a bipartisan sport for 40 years. But today we are focused on the latest wealth theft.

As Common Dreams reported on Wednesday, Republicans and their corporate partners are turning their attention to corporate and personal tax ‘reform’ having failed to repeal and replace the ACA.  To achieve $3.6 trillion in tax cuts without blowing a hole in the budget, Republicans are calling for massive cuts in key safety net programs that primarily benefit low-income families while also increasing funding for the military. Click here for a CNN Report that delineates with precision the proposed cuts.

To justify these cuts, the corporate sector and the GOP are planning a massive media campaign bemoaning how the US has the highest corporate tax rate in the world and so the GOP is justified in seeking massive corporate tax cuts.  While asserting the the ‘statutory tax rate’ calls for corporations to pay 35% tax on their profits, analysis presented by Economic Policy Institute demonstrated that the effective tax rates (actual tax rate after the myriad of loopholes) is estimated to be from 1/3 to 1/2 that rate.  See table at left.
One key provision of the Trump tax ‘reform’ plan would call for reducing the corporate tax rate from 35% to 15%.  Without getting into the arcane Senate rules relating to changes in the tax code, the GOP will only be able to pass their desired reduction in the corporate tax rate to 15% for two years.  But don’t feel too sorry for the corporate sector, as according to a Washington Post report: It would just be the equivalent of “dropping cash out of helicopters onto corporate headquarters for a couple years,” says George Callas, the top tax adviser to House Speaker Paul D. Ryan (R-Wis.). Yes, that quote came from the top tax advisor of Paul Ryan. I suppose the Republicans think the image of trillions of dollars floating down to corporate headquarters is a good thing to campaign on.
Another key loophole that the GOP is seeking to make permanent is the ‘deferral tax loophole’ which allows corporations to accumulate massive amounts of untaxed profits in offshore accounts. Trump had promised to close that loophole when elected, but he has done yet another 180 degree u-turn and the GOP’s most recent tax plan calls for the creation of a ‘territorial tax system’ which would eliminate entirely taxes on profits earned overseas. Economic Policy Institute estimates that currently there are $2.6 Trillion of potentially taxable profit that would entirely escape being taxed under the territorial tax system. Click here for a Common Dreams report on the deferral tax loophole.
 
It isn’t just that corporations will be getting significant tax cuts, personal income tax cuts will also benefit the wealthy, according to analysis from the Tax Policy Center (TPC). “Even when taking the tax cuts and all possible revenue raisers together, the administration’s proposed tax changes would be highly regressive, with most benefits accruing to the highest-income households,” the TPC says. Click here to read the full report.
Over the past two weeks Retake has been highlighting the correlation between the Democratic Party’s embrace of neoliberal policies that benefit the corporate sector and the wealthy and their mounting losses in House, Senate and State elections. Well, the GOP is now finding itself guilty of even more egregious proposals. On the heals of the GOPs highly unpopular efforts to repeal the ACA and with images of dollars floating down corporate headquarters, the Democrats have a golden opportunity.  That is why Retake feels so strongly that the right road for the Democrats is the high road, the road not paved with corporate contributions. In 2018 and 2020, we want the Democratic Party to be a bold blue alternative to the GOP, not just GOP-light.
In solidarity,
Paul & Roxanne

One thought on “More Trump Corporate Giveaways. Trillions Falling from Helicopters?

  1. Who is ‘George Callas’?. Well, he is a lawyer. But if he was an ‘economist’ he would fit this description……”Along the way, a host of radical (though not really radical – just traditional) thinkers tried to warn the logic freaks of economics that their profession was heading into a dead end. Nobel Prize winner Wassily Leontief said: “Departments of economics are graduating a generation of idiot savants, brilliant at esoteric mathematics yet innocent of actual economic life.” Author of The Origin of Economic Ideas, Guy Routh wrote: “The standard economic texts are powerful instruments of disorientation; for confusing the mind and preparing it for the acceptance of myths of growing complexity and unreality.” And the great American economist and historian Robert Heilbroner, famously warned: “Before economics can progress it must abandon its suicidal formalism.”

    But to no avail… for half a century, these warnings have fallen on deaf ears.”
    https://www.adbusters.org/article/the-new-spirit-of-economics/

    But we have all been influenced, without noticing it, by neoliberal economics.
    And, we should also remember what Henry Ford said about Money……It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
    There is much history needed to be rediscovered by us, today. I am afraid that, if we enter a ‘reactive mode’ instead of a ‘proactive’ one, we may make a common mistake as pointed out by Churchill…”A nation that forgets its past has no future.” The gatekeepers of our culture and economy know this well and that’s why it beholds us to Re-discover our history. We could begin by questioning common assumptions like: we are a Democracy, or the Dems are the party of the left and of workers, of minorities, of progressives….

    Like

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