How President Trump has betrayed the working class

For a century the GOP has been bankrolled by big business and Wall Street. Donald Trump wants to keep the money rolling in. His signature tax cut, passed two years ago, has helped U.S. corporations score record profits and the stock market reach alltime highs.

Trump also wants to expand his working-class base. In rallies and countless tweets, he claims to be restoring American working class by holding back immigration and trade.

Most incumbent Republicans and GOP candidates are mimicking Trump’s economic nationalism. As former Trump consigliere Stephen Bannon boasted recently, “We’ve turned the Republican party into a working-class party.”

Keeping the GOP the Party of Big Money while making it over into the Party of the Working Class is a tricky maneuver, especially at a time when capital and labor are engaged in the most intense economic contest in more than a century because so much wealth and power are going to the top.

Armed with deductions and loopholes, America’s largest companies paid an average federal tax rate of only 11.3 percent on their profits last year, roughly half the official rate under the new tax law — the lowest effective corporate tax rate in more than 80 years.

Yet almost nothing has trickled down to ordinary workers.

Trump’s giant tax cut has also caused the federal budget deficit to balloon.

The Trump administration has already announced a $4.5 billion cut in food stamp benefits that would affect an estimated 10,000 families, many at the lower end of the working class. The administration is also proposing to reduce Social Security disability benefits.

The tax cut has also shifted more of the total tax burden to workers. Payroll taxes made up 7.8 percent of national income last year while corporate taxes made up just 0.9 percent, the biggest gap in nearly two decades. All told, taxes on workers accounted for 35 percent of federal tax revenue in 2018; taxes on corporations, only 9 percent.

Trump probably figures he can cover up this massive redistribution from the working class to the corporate elite by pushing the same economic nationalism, tinged with xenophobia and racism, he used in 2016.

But it will be difficult this time around because Trump’s economic nationalism has hurt American workers, particularly in states that were critical to Trump’s 2016 win.

Manufacturing has suffered as tariffs raised prices for imported parts and materials. Hiring has slowed sharply in Pennsylvania, Michigan and other states Trump won, and in states like Minnesota that he narrowly lost.

The trade wars have also harmed rural America, which also went for Trump, by reducing demand for American farm produce.

Meanwhile, health care costs soar, college is even less affordable, and average life expectancy is dropping due to a rise in deaths from suicide and opioid drugs such as fentanyl.

The only tricks left for Trump and the Republicans are stoking social and racial resentments and claiming to be foes of the establishment. But bigotry alone won’t win elections, and the detritus of the tax cut makes it difficult for Trump and the GOP to portray themselves as anti-establishment.

Democrats have a historic chance to do what they should have done years ago: create a multiracial coalition of the working class, middle class and poor, dedicated to reclaiming the economy for the vast majority and making democracy work for all.