Debating over the Republican’s tax plan, Democrats worried that corporate beneficiaries of these tax cuts would waste their winnings on luxuries like stock buybacks. Perhaps unsurprisingly, they were correct.
Those criticizing the proposal also pointed to its variety of lazy but momentous mistakes that would need to be fixed, which is occurring as well.
Liberals also alerted that the repulsive Republican rulers would take the chance provided by the tax reductions to attack social-insurance programs – often labeled as “entitlements” – such as Social Security. Yes, they were right about that, too.
Progressives opposing the Republican tax cuts further explained how the plan would cause real financial harm to the country and how it would not be enough to pay for themselves, adding to the list long of things the Left got right and the Right got wrong. Jon Chait summarized the Congressional Budget Office’s most recent data.
The Congressional Budget Office’s first federal budget analysis published after Trump tax cuts being passed shows how the Republican government has entirely operationalized its ideology. CBO projects the 2018 deficit to be 242 billion dollars higher than it had expected in June, prior to the tax breaks, which are the primary cause. “Accounting for most of that difference is a $194 billion reduction in projected revenues, mainly because the 2017 tax act is expected to reduce collections of individual and corporate income taxes.”
The deficit is predicted to increase to over 5 percent of gross domestic product. This could be reasonable if we were spending to offset some serious, non-permanent crisis, such as recession or major war, but we are not.
The entire CBO report is online here. The budget office predicts the annual budget shortfall will increase this year to $804 billion, before it grows to $941 billion in 2019 and an incredible $1 trillion in 2020.
At some point, Republicans ought to face accountability for their promises regarding tax breaks always being wrong.
Second, while I do not consider deficit reduction a major issue, I understand Keynesian Economics 101 enough to know that this is a bad time to run massive shortfalls. It isn’t complicated: in a recession, the government must borrow to soften the economic downturn, and in a recovery, the government must borrow less because it’s far less necessary.
With a healthy economy, there isn’t any need for Donald Trump and incompetent congressional Republicans to shoot a hole in the country’s finances like this.
And third, Trump swore (lied) up and down in the campaign that he would be a model for fiscal responsibility. In December of 2015, for example, Trump lied that unless policymakers somehow balanced the federal budget, “we’re not going to have a nation anymore.”
I don’t know if Trump understood what he meant, or whether he was just trying to deceive the gullible Republican base. But no matter what, it’s just another promise that stupid evil Trump has broken without explanation.