Tax cut plan hides trillions in debt
unless the GOP leadership restores the status quo.
With Trump in the Oval Office, all of a sudden GOP senators and representatives don’t see deficit spending as being wasteful as they framed it under President Barack Obama. Also, GOP lawmakers have little incentive to try to cut spending, given that Trump never has been a fiscal conservative and likely would oppose cuts.
No budget hawk, Trump campaigned on not messing with Social Security.
Stock market growth
In office, Trump has become even more inclined to magical thinking when it comes to other people’s money.
Trump told a gathering of truckers in Harrisburg that the stock market had grown by $5.2 trillion since he won election — “that’s a quarter of the $20 trillion that we owe.”
Then Trump apparently multiplied the $5 trillion by the four years of his first term and figured, “I’ve increased the value of your U.S. assets by more than the $20 trillion that we currently owe.”
Wrong, responded Patrick Newton of the Committee for a Responsible Budget.
“Stock market gains benefit investors,” he said. “They do not pay down the debt.”
Republicans aren’t all wet when they talk up the dynamic powers that tax cuts can have. The GOP plan would allow corporations to write off equipment purchases in the year they are made, an incentive to buy equipment. A lower tax on corporate profits overseas could persuade CEOS to return offshore dollars to the United States.
But can it make a rabbit disappear? In a recent phone call for Not One Penny, a Democratic-leaning group that opposes the GOP plan, venture capitalist Nick Hanauer scoffed at the notion that tax cuts for wealthy individuals will increase dynamism and growth.
“It is extraordinary that they continue to try to sell this nonsense to the American people,” he said. He likened the approach to “giving whiskey and car keys to teenage boys.”
Contact Debra J. Saunders at dsaunders@reviewjournal. com or 202-662-7391. Follow@ Debrajsaunders on Twitter.