“We won the evangelicals. We won with young. We won with old. We won with highly educated. We won with poorly educated. I love the poorly educated.” – Donald Trump, 24 February 2016
On Wednesday, Donald Trump took his tax proposal on the road … to Indiana. The plan is no winner, but his lies about it underline the fact that either he cannot add 2+2 and come up with four, else he is a greedy bastard who will do anything to line his own pockets. But the worst … the very worst … part of his proposal and his ‘explanation’ is that he makes it perfectly clear that he thinks We The People are stupid. No person with a modicum of intelligence would believe the b.s. he fed the people of Indiana, yet he thinks we are lapping up his rhetoric like cats over spilt cream.
The general idea of the proposal, it would seem, is that rather than cut taxes to the majority of middle-income workers, it will give significant tax cuts to the wealthiest and corporations, and that the rest of us will somehow benefit. Now, I wrote about all this a few weeks ago and as I said then, it is a fallacy that for some reason the republican party seems to love. Money given to the wealthy, to large corporations, stays in their pocketbooks … it does not ‘trickle down’ into ours. Reagan tried it, Bush tried it, and now Trump seems determined to try it. There is absolutely no reason to believe that it will work any better this time than it has in the past. What part of this do Trump & Co. find so difficult to understand? Even his treasury secretary, Steve Mnuchin, claims to believe the lie, though surely he cannot be that stupid.
The proposal is woefully short on details, so much cannot be known as yet. A few points based on what is known …
- He proposes to cut the overall corporate tax rate from 35% to 20%. I have not seen any estimates of how much revenue this would cost the government, but no doubt it would be significant. And no, folks, the corporate savings will not trickle down. Most companies will not give their employees significant increases, nor will they lower the prices of their products. They will not contribute to community programs to beautify the neighborhood and feed the poor. They will pay their CEOs and other officers more.
- The proposal eliminates the estate tax, a tax on inherited property. However, only the wealthy typically pay any estate tax because it is only levied on the value of the property in excess of $5.49 million per person, or nearly $11 million for a married couple. Now seriously, dear readers … is there anyone reading this who anticipates paying estate tax anytime soon? This does not help the majority of the people in this nation. It will, however, be a big help to Donald Trump’s children when he finally drops dead! He claims that it will “protect millions of small businesses and the American farmer.” However, recent analyses show that there are only 50-80 such businesses, not ‘millions’, in the nation that will owe estate tax this year. Again … this helps us how?
- The proposal also calls for the elimination of the alternative minimum tax, a tax designed to keep wealthy taxpayers from using loopholes to avoid paying taxes. Typically, only those whose earnings are in excess of $200,000 will even need to consider the alternative minimum tax. Interestingly, Donald Trump’s tax was increased by $31,000 in 2005, the only year for which we, the people, have any information. So, although Trump claims, “It’s not good for me, believe me,” it is likely to be very good for him and his family.
- Trump claims his plan will drastically increase economic growth, but frankly I have doubts. There is not yet enough detail to be able to make reasonable predictions, but the U.S. consumer at this point would do well to be fiscally conservative, given the state of uncertainty in many areas. One example: if republicans continue with their effort to ‘repeal and replace’ ACA, we will all see higher healthcare costs. I cannot imagine that with a few extra tax dollars in their pockets, most Americans will be running out to purchase more goods and services. But then, I’ve been wrong before.
- Common sense tells most of us that resources are finite and that when you remove revenue, as all these lovely tax cuts for the wealthy will inevitably do, then you must remove an equal amount of expense in order to maintain balance. However, Trump has illusions of grandeur and wishes to build a wall that is likely to cost as much as $70 billion (no, Mexico will not be paying for it), increase military spending, invest in infrastructure, and more. Where is that money coming from? Sorry, folks, but this tax plan, from my perspective, makes no sense whatsoever.
It will be up to Congress to hammer out details and attempt to come up with some plan that is reasonable and that will not dramatically increase the national debt. Let us hope that they have learned a few lessons from their health care debacle and will, this time, consult with experts in the field. And let us hope that this time they manage to remember We The People. I’m not holding my breath, and I suspect there will be just as much posturing, bullying and lying as there was over the multiple health care bills.
I end where I started. Lying to the citizens, including the very ones who did vote for him, is a slap in the face. It is Trump saying, “I think you people are too stupid to know anything, so I can lie and you will believe me.” No wonder he likes the poorly educated. Personally, I am offended.