I get the impression they feel it will help them. But that is confusing to me. The bill isn’t popular. It’ll raise taxes on middle class families, students, sick people, etc as well as cut money from Medicare all to give tax cuts to the wealthy. Why would they think the public will reward them for this? Only about 25-30%of the public will reward them for the tax bill, and those people are diehard Republicans anyway.
Are they just doing it so their donor class keeps their wallets open, and they’ll risk the voter backlash?
It started out popular when everyone thought they would get a free lunch tax cut. Now that it has been revealed that TANSTAAFL is a economic fact, and that indeed, really, only the rich get significant cuts and those cuts are made by borrowing from our kids, now people dont like it as much.
Umm… I don’t thing that the majority of Republican voters have any idea how bad it is. And IF (big if) they ever realize their pockets are being picked, they’ll blame Obama and Hillary.
Sure, donor appeasement is a major driving force. An example of the mindset if tax cuts don’t get done:
What difference does voter satisfaction make if you get primaried? If you genuinely feel, rightly or wrongly, that sucking up to donors and getting their millions in contributions is the only way to even have a chance?
I would also note that there are lot of accounting tricks baked into the tax plans to mask the tax increases. Some of the temporary cuts will in fact lower taxes for a number of people in the short term, even if they ultimately turn into net tax increases as the years go by and the temporary cuts expire.
With the donors or with the voters? Many of these guys are turning tail and quitting. They don’t have to answer to the voters. But, they are going to want positions as lobbyists and think tank participants, so they are beholden to the donors.
If the plan quietly gives major tax cuts to the ten-million/yr and up crew, gives loudly trumpeted small tax cuts of a couple hundred dollars to the struggling working class R voter who believes all his taxes go to poor people’s welfare checks, and hangs the $75K to $450K/yr people out to dry it’ll be a winner for the two constituencies the R care about most.
Those being the donors, and the foot soldiers (AKA economic cannon fodder) who keep delivering the elections to the Rs.
As to the folks in the 75-450 bracket, the farther up that ladder you climb the more you’re at least as interested in your portfolio returns as you are in your W2. E.g. something that reduces a 50yo surgeon’s take-home pay from the hospital by $50k/yr but makes his stock portfolio go up by $400K that same year might be a vote winner in that demographic too.
The silly thing the Rs did was to get a little too greedy on the fat cat cuts, so they had to get a little too creative in slamming every tax credit they can find to make up the difference vs the artificial 1.5T ceiling. So they made just a little too much noise breaking in and now most of the family is aroused to the danger. Had they been stealthier on the break-in they might well have succeeded in gathering up the family silver & slinking into the night.
They may still pull off a big win if they can get enough false news out there to drown out what the Ds and the consumer / professional class advocates are trumpeting.
I vaguely remember some SF story (or universe) where the catlike aliens were actually superior critters with superior tech. Not night and day better vs. Earth, but still clearly better. Yet in most combats they’d lose because they were very excitable and usually did something foolhardy whereas the Terrans were a lot more deliberate under fire and usually avoided the unforced error for the win.
The Rs these days remind me of those fictional aliens. They’re ahead, they get excited that they can utterly sweep the field, then they overplay their hand and fall short of what they could have achieved had they been more … judicious.
I think you are thinking of Larry Niven’s “Known Space” and the Kzinti, who tend to “Scream and Leap” rather than thinking things through, making them easy targets for the deceitful and clever Terrans.
That piece of trivia accomplished, I find little to disagree about in your post. I think they are aware of this, which is way a number of changes don’t take effect (IIRC) until 2019–after the 2018 elections.
Thinking short-term instead of long–scream and leap politics.
Sure, the optics of “we got something done” are marginally better than “Democrat obstructionism,” particularly after how they botched Obamacare repeal. Not to mention that the Senate bill repeals the individual mandate; if that stays in and gets passed, they’ll say they repealed Obamacare.
ehh… This has little to do with the GOP in power, but everything to do about how they can fool their constituents to keep them there.
They will not get higher wages under the GOP. This is a lie after lie that they believe. And it ties into their bigotry and racism.
They will not get better health care. Emergency rooms seem fine to the GOP supporters. And it drags the whole system down. They will blame the outrageous ER bill on some democrat. And refuse to see the big picture of insurance and health care and how it works.
IMHO, the base GOP voter looks no further than keeping ‘one of them’ moving next door. And they are doing nothing more than shoveling sand to keep the top on the top.
It’s going to help pass-through entities, such as small business owners (whether sole proprietorships, S-Corps, partnerships, etc.) tremendously. This form of income is currently taxed to the end taxpayer, not at the corporate level. At the end of 2017, this popular type of business income potentially faced the maximum tax rate of 39.6%.
That changes in 2018. 20% of taxable income for pass through entities gets taken off the table for tax calculation purposes. That means if you’re in the new highest 37% tax rate for 2018, this rule lowers your effective tax rate to 29.6%.
About 2/3 of all job creation in America is due to small businesses, so the savings will be re-invested in things that will make small businesses more profitable, such as hiring new employees, as well as purchase of services and equipment, benefitting other small business owners and manufacturers. I own a small business and am hiring two new employees. The job generation potential from bringing U.S. business taxation in line with competing 1st world nations is a smart, savvy move by the Republicans. Trying to cancel it would be politically unpopular for the Democrats, particularly if we see the expected level of job growth and new small business creation - which has traditionally been an important method to raise one’s economic status for minorities and new immigrants.
Not everyone in America is either a a plutocrat lighting cigars with $100 bills, or a proletariat working at the kind of job you saw in Fritz Lang’s Metropolis. There is a large class of entrepreneurial talent in America that is looking at this bill, and will remember who passed it.
Parents will find that doubling the Child Tax Credit will be very helpful, as will the fact that 529 accounts can now be used to pay for primary and secondary education, at a potential tax savings for parents, instead of just college, as will the doubling of the standard deduction.
However, tax reform of any kind is basically meaningless until we impose a balanced budget on Congress and get them to stop spending tax dollars like drunken sailors.
Since they didn’t go that route, it’s a moot question.
Now if the question is, will that mess of a tax bill they actually passed, that made the tax code more complicated, more inequitable, less comprehensible, and more an invitation to gaming and manipulation than ever - will that bill help them? I doubt it.
First of all, though there is a modest short-term tax benefit for most people, few people who can’t afford good tax lawyers will see the fruits of this bill before tax time in early 2019, after they’ve already voted the GOP out of Congress.
Second, the popular belief - which is pretty accurate - is that this bill is all about helping the ultra-rich, and they’re just getting the handful of coins an 18th-century aristocrat might throw to the street rabble.
Third, remember 2009-2010. Obama cut taxes for most lower and middle class Americans as part of the stimulus bill. But the ‘taxed enough already?’ crowd, aka the Tea Party, persuaded Americans that their taxes were going up - and they were believed, even though they were wrong.
It will be an uphill battle for the Republicans (and their allies like the Koch brothers) to persuade people that their taxes really are getting cut, let alone that they’re not being bought off with pennies while the rich make out like bandits.
An often quoted and mostly false factoid. What matters is not job creation, but *net *job creation. Most small businesses fail during the first year. If we tot up each of the jobs temporarily “created” it’s a big number. But 12 months later the net effect is very, very close to zero as almost all those jobs were destroyed again when the business later closed. But that destroyed number isn’t counted in the magic “2/3rds” that folks like to bandy about.
As to the tax changes:
There is exactly one reason to add workers: You need more output. Which comes only from more sales. IF the tax code changes cause more people to buy more of whatever you make, then you’ll want to hire more workers. If not; not.
That will undoubtedly go over well.
I believe that I’ll be able to use the rent income as pass through and have 20% of it not taxed. I will be retired when income tax kicks back in for we little guys, in what five or eight years?
Presumably you are hriing two new workers because the amount of revenue that those workers generated is greater than the cost of hiring them. If so, then wasn’t that true whether or not you got a tax break? The tax break only acts as a multiplier to your eventual profits. It shouldn’t change the tipping point of whether a specific decision increases or decreases those profits.
I suppose if you are cash poor and paying for your business out of pocket it might tip you over the line to buying a machine to improve your productivity (and maybe lay off some workers that the machine can replace), but given the historically low interest rates, if you could make a solid case that expanding would be profitable you could probably get a loan. There are times when the supply side needs pumping with extra cash, but with historically low interest rates and businesses sitting on pile of cash, this isn’t one of those times.
