In a recent tweet, Donald Trump claimed, “I will keep fighting for the American people!” Donald is not particularly literate, and thus his words often need some translation. In this case, the translation only requires the addition of a single word: wealthy. “I will keep fighting for the wealthy American people!” And by default, the rest of us can go to hell. If you’ve been awake for the past 18 months and kept your eye on the ball, this will come as no surprise. The 40% or so who still think Donald Trump is the greatest thing since sliced bread will, no doubt, continue to ignore the writing on the wall.
You will remember that last year Congress passed a tax bill that included tax cuts for the wealthy, but did very little for the average wage earner. And the wealthy were happy, for they heard the ‘ka-ching’ of still more money hitting their bank accounts, so they donated some of that money to republican candidates so the republican candidates could buy more air time on national television to stay in office and ultimately give those wealthy people even more advantages. It’s a vicious circle.
But apparently the glow of their tax cuts wore off, and now they want even more. And guess what? Trump and his minions want to give it to them! Now, members of Congress are cognizant of the fact that there is an election in less than 100 days, and they don’t want to rock any boats right now by giving the wealthy more money, for they understand that the rest of us also get to vote on November 6th. So, Trump & Co have found a way to do their reverse Robin Hood act without the blessings of Congress, and certainly without the blessings of We The People!
From The Washington Post …
The Treasury Department is considering a tax cut for the wealthiest Americans through a change that would not need approval from Congress, officials said, a move that would follow a package of tax cuts last year that also benefited the super-rich.
The agency is studying whether to allow investment income, known as capital gains, to be adjusted for inflation in a way that shields more of it from taxation. Most capital gains are paid by wealthier Americans, who disproportionately hold large portfolios of investments.
A brief explanation of capital gains …
When you sell stock, you likely realize either a capital gain or loss, which is the difference between the amount for which you sold it and the amount you initially paid for it. If you paid $1,000 for 25 shares of XYZ stock in the year 2000, and you just sold it for $900, you have a capital loss of $100. Conversely, if you sold that same stock for $1,100, you have a capital gain of $100 which is subject to income taxes.
But what Steve Mnuchin, Secretary of the Treasury Department, is suggesting is that the basis, or what you paid for that stock, should be adjusted for inflation in the calculation of capital gains. Thus, it could be argued that the $1,000 you paid in 2000, adjusted for inflation, is equivalent to $1,100, thus wiping out your capital gain and BINGO — you now owe no taxes on that gain! Now, when you consider that for the wealthy those capital gains may be in the millions of dollars, well you can only imagine how much they would save in taxes. You and I won’t benefit more than a few dollars, if that, but people like Donald Trump, Betsy DeVos, and a host of others, stand to save hundreds of thousands in taxes.
The wealthiest 1% of American households own 40% of the country’s wealth. That share is higher than it has been at any point since at least 1962, according to a study by economist Edward N. Wolff. Meanwhile, you and I struggle to pay the bills and put food on the table, keep the 10-year-old car running for another year, and cut corners wherever we can.
Trump’s policies and the December donor tax cuts have already plunged the nation into deeper debt and increased the deficit. This move further reduces the income without doing a single thing to reduce expenses. And it can all be done without Congressional approval. If you ever had any doubt whether Trump had the good of the nation and its people in mind, this should convince you.
Oh … and would you be interested in knowing Steve Mnuchin’s net worth? $400 million. Personally, if this is what Donald Trump means when he says he will “keep fighting for Americans”, I wish he would just stop fighting. The wealthy, under Trump, are having a field day, but eventually, as those of us whose brains have not been replaced with dollar signs know, eventually the party comes to an end. Debts come due and there are very real consequences when there is no money in the treasury to pay those debts. And what about the rising poverty rates in this nation? How do you explain to a poor person that you are cutting their food stamps because the rich people are paying less taxes and, well, sorry but there just isn’t enough money for you to feed your children?
That “great economy”, that rise in Gross Domestic Product (GDP) that he keeps bragging about? Guess what, folks … it doesn’t mean a damn thing for the average citizen in the U.S. Sure, unemployment is low, but wages haven’t risen. Many lower income people still have to work 2 or even 3 jobs just to buy food and keep a roof over their heads! But by all means, let us make the wealthy even wealthier.