GOP tax plan is cyn­i­cal wealth re­dis­tri­bu­tion

The Trentonian (Trenton, NJ) - - OPINION -

The GOP-ap­proved tax plan soon headed to the pres­i­dent will be a mas­sive wealth trans­fer to cor­po­ra­tions, the rich and red states that helped put Don­ald Trump in of­fice.

Blue states in­clud­ing Cal­i­for­nia will bear the brunt, as the changes wipe out de­duc­tions for state in­come taxes, cap the property tax de­duc­tion at $10,000 a year and, un­der the House ver­sion, wipe out the mort­gage de­duc­tion for fu­ture home pur­chases.

There are still key de­tails that Repub­li­can lead­ers must ham­mer out to rec­on­cile dif­fer­ences be­tween the House and Se­nate ver­sions. But when the Se­nate ap­proved its plan Satur­day morn­ing, any hope of stop­ping this train wreck was lost.

The ques­tion now, af­ter both houses added ma­jor pol­icy changes, is how bad the fi­nal ver­sion will be.

They will likely keep the Se­nate pro­vi­sion wip­ing out the health in­sur­ance man­date penal­ties that are key to keep­ing rates down for ev­ery­one. The Con­gres­sional Bud­get Of­fice pre­dicts in­sur­ance pre­mi­ums will rise by about 10 per­cent a year as a re­sult and 13 mil­lion peo­ple will drop cov­er­age by 2027. The UC Berke­ley La­bor Cen­ter es­ti­mates that in­cludes up to 1.7 mil­lion Cal­i­for­ni­ans.

At a time when we should be mov­ing to al­ter­na­tive forms of en­ergy, will Re­pub­li­cans open up Alaska’s Arc­tic Na­tional Wildlife Refuge to oil and gas drilling? That pro­vi­sion was added to the Se­nate ver­sion to win sup­port of Lisa Murkowski, R-Alaska.

As if there weren’t enough sweet­en­ers for the wealthy in this plan, do we re­ally need to elim­i­nate the es­tate tax, which al­ready ex­cludes the first $5.49 mil­lion of in­her­i­tance from tax­a­tion? Both ver­sions would dou­ble that, with the House bill elim­i­nat­ing it al­to­gether af­ter 2024.

And will they side with the House to break down the sep­a­ra­tion be­tween church and state by re­peal­ing the John­son Amend­ment, a 63-year-old pro­hi­bi­tion on non­profit groups en­gag­ing in po­lit­i­cal ac­tivism?

The Se­nate plan would cut tax rev­enues by $1.447 tril­lion over the next decade, ac­cord­ing to the con­gres­sional Joint Com­mit­tee on Tax­a­tion. Re­pub­li­cans ar­gue that will pay for it­self when cor­po­ra­tions and rich peo­ple, who are the big­gest ben­e­fi­cia­ries, in­vest their tax sav­ings in the econ­omy.

Ev­ery anal­y­sis of the bill de­bunks such trickle-down non­sense. The joint com­mit­tee es­ti­mates that even af­ter an­tic­i­pated eco­nomic growth, the net cost of the plan will be $1 tril­lion over 10 years.

Fu­ture pay­ments on that debt will crowd out avail­able funds for ser­vices. Which fits neatly into the GOP play­book of shrink­ing the size of govern­ment.

We don’t know yet ex­actly which pro­grams will suf­fer the great­est cuts, but this Repub­li­can con­gress is more likely to tar­get health care for the poor than, say, mil­i­tary spend­ing.

It was per­haps most telling on where their pri­or­i­ties lie when Se­nate Re­pub­li­cans opted to make the tax cuts for cor­po­ra­tions per­ma­nent but pro­vided a 10-year sun­set for cuts that would ben­e­fit in­di­vid­u­als.

Don’t let any­one tell you this is tax re­form. There is no re­form in it, just a cyn­i­cal re­dis­tri­bu­tion of wealth to Re­pub­li­cans’ donor base.

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