The stated reason for the big federal tax cut push is to pass something to please voters before the 2018 election.
If the stated reason was true, the tax plan would be something popular.
The most loudly expressed issue of the 2016 elections was bipartisan fury at an establishment that only takes care of itself. The presidency was won by a man who raged about the rigged system. Behold how little difference it made.
George H.W. Bush's "read my lips" tax increase of 1990 had more public support in polls at the time than this tax cut does now, the website FiveThirtyEight pointed out Wednesday. Even the 1993 tax increase pushed by Bill Clinton had support averaging 34 percent in polls at the time. The November average for the tax cut before Congress as of Wednesday was 32 percent.
Consider those figures in light of the broad, in-general support a normal tax cut always gets. There was 62 percent support for cutting taxes across the board in early October, polls say. There probably still is. The specific plan being pushed, though, has not shown more than 36 percent support in any poll since. Support dropped to 25 percent in at least one credible poll as details of the plan came out.
Pardon the cliché, but this plan really does miss the broad side of a barn. A simple accross-the-board whack would have more voter appeal and increase the deficit by less. Instead, the bill would raise the effective tax rate or leave it virtually unchanged for most people to the clear benefit of those already thriving. The non-thriving parts of the economy, where the most voter anger comes from, get nothing.
The Joint Committee on Taxation tries to brag that taxes will go down for 62 percent of those filing -- by using the very low bar of $100 in lowered taxes to cross. That is like bragging about being a weightlifter by standing up. Crafting a bill that raises taxes on 38 percent, is a wash for most and still increases the deficit by $1.5 trillion over 10 years is a remarkable feat of sorts. It only stayed within a $1.5 trillion estimate by using accounting tricks. Reality will be worse.
A cynic might wonder if this plan has less to do with keeping a Republican majority in the House than with giving donors some return on their investment before that majority may be lost. This is not steering the ship of state to go where people want. This is running for the political lifeboats.
If anyone has any doubt how Congress will do anything to keep donations flowing in, consider Politico's story that also ran on Wednesday. Staff members of the National Republican Senatorial Committee hacked their counterpart in the House, the National Republican Congressional Committee, to get the names of 200,000 donors.
"It has spotlighted Senate Republicans' deep fundraising struggles this year, with the NRSC spending more than it raised for four months in a row," Politico reported. "Multiple NRSC staffers, who previously worked for the NRCC, used old database log-in information to gain access to House Republicans' donor lists this year."
Perhaps the hackers should have asked the Russians for help. Then they could have gotten the names through WikiLeaks while denying their own involvement.
Wednesday was a really good day for journalism on the tax topic and Congress. I particularly recommend Greg Ip's column in the Wall Street Journal on that day. His point about how wealthy individuals will rush to redefine themselves as "pass-through" partnerships that pay taxes at individual rates instead of corporate ones is as close to fascinating as tax policy journalism gets.
Cobbled-together expedients in a desperation-driven rush job of a tax bill always make some clever analysts rich and their clients much richer. All they have to do is figure out the angles Congress did not consider. "There are more ticking time bombs in this bill than a Road Runner cartoon," as Ip's column quotes Martin Sullivan, chief economist for the nonprofit group Tax Analysts.
Those who will benefit the most from this bill are those who can afford to hire clever young men and women to find the gaps Congress will create, knowingly or not, and have the resources that can take advantage of what is found.
Commentary on 12/02/2017