Trump calls it the middle class miracle, but the miracle will be if they buy this theft. Two charts in this post tell a very different story::Huge giveaways to the 1% and corporations, less than 2% tax cut for the poor and middle class. You can’t make this up.
You simply can’t make this up. You have to ask yourself when Trump supporters will wake up and smell the coffee. Every health plan Trump and the GOP has proposed would decimate working America, raising premiums, eliminating coverage for pre-existing conditions, raising co-pays, and eliminating Obamacare regulations that prevented insurers from offering bogus plans that were far cheaper, but eliminated all kinds of coverage–essentially providing non-coverage, but cheaper. Guess who buys these plans? Guess who doesn’t?
If that weren’t bad enough, here comes Trump Tax Deform. While crowing that it is the middle class miracle, the charts below tell a VERY different tale. Trump’s plan would vastly reduce taxes on the 1% and corporations, while barely providing any relief for the poor and middle class. While most Democrats have been resisting Trump since day 1, there remains a base in America that believes this guy. Could this be the plan that starts to pull the curtains on this clown? Read on.
Using conventional scoring methods, the non-partisan think tank, Tax Policy Center estimates that Trump’s plan would reduce federal tax revenues by $2.4 trillion over the first decade and by $3.2 trillion over the following decade with the business sector and the 1% being the primary benefactors of this theft. See table at left.
Over the first 10 years, the individual income tax provisions—excluding those related to the taxation of corporations, pass-throughs, and estates—would raise $470 billion, i.e. largely personal income taxes. But the business provisions would reduce revenues by $2.6 trillion, and repealing the estate tax would cost another $240 billion. The revenue gain from these individual provisions would increase over the ten-year budget window. The revenue loss from the business income tax provisions would be higher in the first five years because expanded business expensing expires after that period, for a net cut in revenues of $2.4 trillion. And given that Trump has already announced plans to increase military expenditures, guess who will bear the brunt of the inevitable cuts.
Over the following decade (fiscal years 2028–37), the individual provisions would raise much more revenue, $1.4 trillion, while the business provisions would lose much more revenue, $4.1 trillion, and estate tax repeal would cost an additional $440 billion. The resulting overall revenue loss would be $3.2 trillion. Click here for the complete Tax Policy Center report.
While Trump continues to boast that this is a middle class miracle, the miracle is that some people in the middle class will believe him. The chart at left tells a brazenly different story. Since the estate tax only kicks in at $11 million, i.e. you already can pass $10.9 million on to your heirs without a penny of tax, guess who benefits from eliminating the estate tax? I don’t think I even know a single person who would benefit from this. I bet Donald does. The chart at left shows the overall impact of Trump’s plan. A picture tells a thousand words. How is this gonna get sold on the American people.
Trump’s plan would raise the standard federal deduction to a level where about 25 million homeowners would no longer take advantage of the century-old mortgage deduction. A married couple would need a home-loan balance of about $608,000 — almost triple the mortgage on a median-priced U.S. home — before using it would make sense, according to a new analysis by property-data provider Trulia. So while the middle class loses the benefit of a mortgage deduction, those with mortgages over $600K would continue to benefit. Again, guess who that might be?
The proposal “is a backdoor way of rendering the mortgage-interest deduction close to worthless,” said Mark Zandi, chief economist for Moody’s Analytics. While Trump may not technically change the deduction, he would probably eliminate its usefulness for all but the most wealthy homeowners, said Joseph Rosenberg, a senior research associate for the nonpartisan Tax Policy Center.
That’s it for today. You can expect another Congressional battle over this plan, but here, I fear the GOP will stand unified. We can only hope that Trump supporters finally see the brutal truth of this regime.
Roxanne and Paul
Next week, we will report on the Red Nation Conference in Gallup. We hit the road the minute I hit send.