The Tax Bill Is a F**king Disaster
A cynical bill from cynical politicians that promises to screw a lot of people over.
In an alternate universe, one where you stick to your diet and the trains run on time and politics is as shiny and earnest as an episode of The West Wing, there is a tax reform debate going on where all the sides are respectful and intelligent. Republicans, in that universe as well as this one, want to reduce taxes, especially taxes on corporations, allegedly on the grounds that it will grow the economy. There is discussion of cutting some of the inefficient loopholes in the tax codeprimarily benefitting rich homeowners. Everyone agrees that obviously the IRS should use the information it already has to do most people’s taxes for them. There are ideological disagreements between the parties, but both sides agree that if the deficit is going to be blown up, there should be good reason for it, and the primary purpose of any tax reform project should be to make life easier for as many Americans as possible.
In our universe, alas, things are different. Congressional Republicans are advancing a pair of tax bills—one passed in the House already and one could pass the Senate in a matter of hours—as quickly as they can, with seemingly little regard for the impact they might have on the economy. Principally, the goal of this round of tax reform seems to be to reduce taxes on corporations and wealthy heirs (the Trump family alone would save over $1 billion, according to one analysis). Middle-class people get tax cuts, too, but those cuts, unlike the giveaways to the wealthy, are set to expire as time goes on. Most people making under $75,000 will see their taxes rise by 2027 under the Senate bill because the elimination of the Affordable Care Act’s mandate means a lot of them won’t buy health insurance, and therefore won’t get subsidies and tax credits to pay for it. Thanks to a set of deduction eliminations, some middle-class households could get a tax hike next year, according to a New York Times breakdown. And selected groups, like grad students and people living in California and New York, seem to have been singled out for punishment.
Even that summary glosses over many elements of the two bills. Yet this complicated legislation is being rushed through at breakneck speed. The Trump administration’s Treasury Department promised it would come up with a model showing that though the plan costs $1.5 trillion in revenue over ten years it would pay for itself by growing the economy. But that model hasn’t appeared, and even the rosiest expert estimates say it won’t come close to being revenue-neutral. On Thursday, the nonpartisan Joint Committee on Taxation released an assessment of the bill that factored in growth effects and found the Senate version would still jack up the deficit to the tune of $1 trillion over ten years.
A Republican spokesperson for the Senate Finance Committee immediately responded to that assessment by saying, “An analysis of tax provisions that do not reflect the final outcome of the evolving Senate tax bill—which will be amended on the floor this week—is incomplete.” In other words, it’s impossible to judge the bill because it’s still being written. And indeed it still is: After plans for a “trigger” that would raise taxes if certain revenue targets weren’t hit got scrapped Thursday evening, Republicans were considering reducing some tax cuts in order to lower the bill’s cost, though which taxes and how big the cuts would be was totally unclear.
But if key elements of the bill are still undecided, voting on it seems like trying to build an airplane and fly it at the same time. And with the economy looking pretty good on paper right now (as Donald Trump loves to remind us), there’s little reason to rush it through rather than, just for example, reauthorizing the Children’s Health Insurance Program, which is getting closer to running out of money every day. Large companies have plenty of money and borrowing is relatively easy, meaning that a big corporate tax cut is unlikely to do much to boost hiring or wages. Instead, that extra cash will likely trickle down only as far as shareholders and trust funds. Does that sound like it should be an urgent congressional priority to you.
If the Senate passes its bill, the House and Senate will need to conference in order to sort out the substantial differences between the two versions. Democrats will likely be frozen out of the process as they have been throughout this year’s debates over taxes and healthcare. As the Times noted Thursday, the decisions made by Republicans in the next few days could reshape more than just taxes. Churches might have fewer constraints on political activism. States and cities could be pressured to cut their own taxes or slash services. And if the federal deficit grows, as it almost certainly will, Republicans could suddenly rediscover their deficit-hawk ways and call for reductions in government programs that provide benefits to the poor and elderly.
The accelerated process seems designed to evade public scrutiny of any kind; the sad thing is, it might work. Even nominally anti-Trump Senate Republicans like Bob Corker, John McCain, and Jeff Flake are backing this bill—tax cuts for the wealthy remain a cause that unites the GOP. If the tax reform package does become law, Republicans will have gotten what they wanted: dump-trucks of money delivered to their wealthy donors’ doorsteps, a set of fuck-you provisions that make life harder for Democratic constituents like student debtors, and a deficit spike that younger people, whom the GOP manifestly does not give a shit about, will have to eventually deal with.
It’s a cynical piece of legislation written by cynical people and endorsed by a cynical president who forgot about his populist campaign promises the same way he seems to forget about lots of things these days. The tax bill is complicated, but really it’s simple—the people in charge do not care about the consequences of their actions. They also don’t care about you.