In defense of the GOP and Mitch McConnell (and before anyone chastises me for that, hear me out), it’s not realistic to think that anyone actually reads all the legislation that gets voted on.
That’s a truly absurd state of affairs, but the fact is, lawmakers tunnel on what’s important to their constituents (that’s part of holding public office) and what we end up with is slapdash public policy.
In a way, it’s all crowd sourced. You cobble something together and hopefully, it ends up representing the general public interest by virtue of the fact that self-preservation requires lawmakers to fight for/against whatever parts of a given piece of legislation impact their constituents. Of course crowd sourcing is inherently flawed and when you introduce partisanship into the equation, the whole thing becomes a giant cluster fuck. Meanwhile, it’s incumbent (get it?) on party leaders to take a kind of 30,000 foot view of things in an effort to push for legislation that subjugates narrowly-construed, local interests to the broader party agenda (i.e. in-line with the donors).
Given all of that, the fact that no one actually read the tax cut bill that barely passed the Senate in the wee hours of Saturday morning and the fact that the legislation is clearly aimed at advancing the interests of corporations and the wealthy isn’t exactly a surprise. No one reads this shit save for the parts that matter to their constituents and Republicans control the government. Therefore, we got what we got: a tax cut bill that disproportionately benefits corporate America and the rich and that seeks, once again, to give trickle down economics a try even though history shows it never fucking works.
So when I say “in defense of the GOP and Mitch McConnell”, all I mean is that you can spare me the incredulity because everyone knew this was coming and there’s nothing “new” about the process.
Neither, by the way, is there anything particularly shocking about the fact that a party full of purported deficit hawks advanced a piece of legislation that balloons the deficit. These party-line “principles” get tossed out the window when political expediency requires it, and that goes for both Republicans and Democrats.
Ok, with all of that said, this was a particularly egregious example of a dynamic that is ubiquitous. For one thing, this is a pretty big piece of legislation, so if ever there were a time when everyone should take a breather and actually read the damn thing, this was it. Further, this looks like it was even more farcical than usual. Have a look at these tweets:
Trying to review the #GOPTaxScam but they are making hand-written changes to brand new text as we speak – can anyone else read this? pic.twitter.com/JX8v1v4gyi
— Senator Dick Durbin (@SenatorDurbin) December 1, 2017
They are scribbling changes in the margins. What could possibly go wrong. https://t.co/dXtHjc1JDm
— Brian Schatz (@brianschatz) December 1, 2017
Senate Republicans can’t put their own scribbled amendment into the record because nobody can read it. This is what we’re voting on. #Page257 pic.twitter.com/SoEo4TvfBc
— Senator Dick Durbin (@SenatorDurbin) December 2, 2017
So much for regular order! Oh yeah sure, we'll have plenty of time to read the final GOP tax bill – if you can make out the scribbled handwriting snuck into this massive, unsearchable PDF. #GOPTaxScam pic.twitter.com/a64mNovvHQ
— Senator Bob Menendez (@SenatorMenendez) December 1, 2017
.@SenateMajLdr, if you are so intent on forcing middle class families to foot the bill so your donors can have a tax break, at least have the decency to find a printer. #GOPTaxScam pic.twitter.com/qFkfaru6ml
— Nancy Pelosi (@SpeakerPelosi) December 1, 2017
I was just handed a 479-page tax bill a few hours before the vote. One page literally has hand scribbled policy changes on it that can’t be read. This is Washington, D.C. at its worst. Montanans deserve so much better. pic.twitter.com/q6lTpXoXS0
— Senator Jon Tester (@SenatorTester) December 2, 2017
Ultimately, we shouldn’t act like this is a surprise, but on the other hand, we certainly shouldn’t pretend like this is something that is acceptable from our elected officials. This is a complete and utter debacle, and everyone (including the GOP) damn well knows it.
The only thing that matters here is getting this thing done by the end of the year so Trump and Republicans don’t have to suffer the embarrassment of having to admit they didn’t get a single thing done in 2018.
That is not a good excuse for doing a half-assed job when it comes to passing a tax plan that literally no one besides corporations likes or really even wants in the first place and that pretty much every nonpartisan analysis has shown is doomed to fail.
Good enough for government work?
We need to be looking to decrease the Federal deficit……not increase it.
We have been in almost a best case scenario for decreasing the deficit, and still not much progress.
This tax bill, combined with a serious recession, has the potential to turn Treasuries into junk bonds..
Well, well, well here we are with a big pile of sh*t dumped on our collective heads.”Trickle down your leg” economics will again push us further into the abyss and we slide toward “fake” everything. How many more times will the republican voters fall for this? Hopefully this will be the one that pushes these hypocrites and their protection of our “liar in Chief” out of office.
Folks when “the black guy” was in office these same lying hypocrites said “deficit neutral” so many times people actually looked up it’s meaning. I actually thought (stupid me) that some republicans would stand-up and put our country ahead of $$$$$$$$$$$$$, yea………….right………. fu*k’em all right out of office.
Thanks for pointing out how the “Freedom Caucus”, the supposed deficit hawks in the GOP, have been completely silent in the face of a massive increase in deficits and debt in this bill.
We need to repeal the 16th amendment to the US Constitution that established Congress’s right to impose a Federal income tax. The 16th amendment was enacted by one state legislature after another early in the past century. State legislators need to repeal the 16th amendment. Prohibition was repealed by the 21st amendment through state conventions. It is time of similar actions to repeal the 16th amendment.
The nation’s financial future is too important to trust to politicians.
….settle down now. The best way to play this is to let them see if they can get it over the line in Mueller Time.
If by chance they do, it’s gonna s**k, but then if they can pull off 2018 then they can reap the DEFICIT and the RECESSION or should I say DEPRESSION 2.0 they created when making this lousy 500+ page sausage.
Join together and help them live with their r*m job!
Wait – please do an article explaining that handwritten stuff about C corp. conversions.
There are many different ways to categorize households as between those that are middle class and those that are rich. Likewise, there are a number of ways to measure how a change in the tax code impacts various sectors in the economy. There are also different methodologies used to calculate what percentage of federal taxes is paid by middle class households as compared to the rich. However, by any conceivable way of delineating the middle class from the rich, and measuring the impact of changes in the tax code, any tax bill enacted this year or next will be the most massive shift ever, in the tax burden away from the rich and thus onto the middle class.
While critics of the Republican bills correctly call it war on the middle class, a more accurate critique would be to call it war on wage earners. Middle-class households that do not primarily live on wages or pensions but rather derive their income from dividends, profits or inheritances will come out ahead. Likewise, those whose very high incomes come solely from wages will do worse. It is likely that many of those who now are paid salaries will try to reorganize themselves so that their salaries are now pass-through business income, which is to be taxed at a much lower rate than wages, salaries or pensions.
As was seen in Kansas, where the rate paid by pass-through entities was reduced so that it was advantageous for those collecting salaries to reorganize themselves into pass-through entities, many highly paid individuals did so. Bill Self, the state’s highest paid employee, does not pay state income tax on millions he earns as the University’s men’s basketball coach since he uses a Limited Liability Corporation to be compensated for his services rather than a salary.
Various Republican officials have asserted that the new tax bill will put procedures in place to make sure that all personal service income such as wages, salaries or pensions will be taxed at the higher rate. This procedure would involve determining for all pass-through entities what “reasonable salaries” are for the owners of the pass-through entities. It is mind-boggling to consider how many more Internal Revenue auditors will be needed to make those “reasonable salaries” determinations for the millions of pass-through entities. So much for a simpler tax code.
Whether it is labeled a war on the middle class or a war on wage earners, it will be a mostly a massive shift of the tax burden from the wealthy and on to everyone else. Shifting the tax burden away from the rich and onto the middle class will eventually reduce economic growth. The question is how much harm will be done by the tax bill and how long it will take for the economic weakness to manifest itself. Related to this is the chance that one of the two classic risks to investors emanating from Federal Reserve action described above will occur before the eventual economic weakness manifests itself. Both of the scenarios of classic risks to the securities markets from Federal Reserve action last only until economic weakness is obvious to such an extent that the Federal Reserve changes course and reduces interest rates.
The latest versions of the tax bills increase the likelihood that negative impacts are likely to be seen sooner rather than later. This could be beneficial to securities that are sensitive to Federal Reserve action, as the economic weakness could dissuade the Federal Reserve from raising interest rates. However, the final version is not yet known.
Previously, the mechanism by which shifts in the tax burden away from the rich and thus onto the middle class eventually resulted in financial crises involved overinvestment. It is not just a coincidence that tax cuts for the rich have preceded both the 1929 depression and the 2007 financial crisis. The Revenue Acts of 1926 and 1928 worked exactly as the Republican Congresses that pushed them through promised. The dramatic reductions in taxes on the upper income brackets and estates of the wealthy did indeed result in increases in savings and investment. However, overinvestment (by 1929 there were over 600 automobile manufacturing companies in America) caused the depression that made the rich, and most everyone else, ultimately much poorer. Likewise, overinvestment, after the Bush tax cuts shifted the tax burden away from the rich and thus onto the middle class, resulted in overinvestment, especially in both residential and commercial real estate. The effects of the resulting financial crisis are still being felt.
As was described in A Depression With Benefits: The Macro Case For mREITs: http://seekingalpha.com/article/1543642
In free-market capitalism, capital generates income for the owners of the capital which in turn is used to create additional capital. This is very good. Sometimes, it can be actually too good. As capital continues to accumulate, its owners find it more and more difficult to deploy it efficiently. The business sector generally must interact with the household sector by selling goods and services or lending to them. When capital accumulates too rapidly, the productive capacity of the business sector can outpace the ability of the household sector to absorb the increasing production.
The capitalists, or if you prefer, job creators use their increasing wealth and income to reinvest, thus increasing the productive capacity of the business they own. They also lend their accumulated wealth to other business as well as other entities after they have exhausted opportunities within business they own. As they seek to deploy ever more capital, excess factories, housing and shopping centers are built and more and more dubious loans are made. This is overinvestment. As one banker described the events leading up to 2008 – First the banks lent all they could to those who could pay them back and then they started to lend to those could not pay them back. As cash poured into banks in ever increasing amounts, caution was thrown to the wind. For a while consumers can use credit to buy more goods and services than their incomes can sustain. Ultimately, the overinvestment results in a financial crisis that causes unemployment, reductions in factory utilization and bankruptcies all of which reduce the value of investments.
This time we may have a much shorter overinvestment period and go almost directly to the financial crisis period. This could occur if disruptions to specific sectors precipitate a financial crisis. There is now a significant possibility that disruptions to specific sectors in the economy could be more important than the negative macroeconomic impacts of the Republican tax bill. Eliminating the Obamacare individual mandate, as is currently in the Senate version, would cause there to be 13 million less people with health insurance. Uninsured people spend less on healthcare than those with insurance. Most studies indicate a 25% difference. Thus, fewer insured people will result in less spending on healthcare than would have been the case otherwise. Other than the direct impact on GDP from lower expenditures, there could be financial distress as some firms in the healthcare become unable to pay their debts.
The risks of defaults stemming from weakness in the housing-related sectors probably exceed that of healthcare. The homebuilders are correct in their complaints that most of the tax advantages of home ownership will be eliminated in all of the Republican tax bills. The Senate version now eliminates deductions for state and local taxes, including real estate taxes. The House version allows deduction for real estate taxes up to $10,000. As the homebuilders point out, many more middle- and low-income people will no longer itemize, since the standard deduction has increased, and many other deductions will be reduced or eliminated. Additionally, a lower limit on mortgage interest deduction for new home purchases reduces tax advantages of home ownership.
Thus, as the home-builders now argue, only a few relatively wealthy households that still itemize will get any benefit from the $10,000 real estate tax deduction. For those wealthy households, a $10,000 deduction is not likely to be a major factor when deciding whether to buy a home. The net result could be a significant negative impact on home prices. As we saw in 2007, a decline in real estate prices can easily spillover to the financial sector…”
https://seekingalpha.com/article/4127862
Pretty clear to me. It says:
“ADD
(a) adjustments attributable to conversion from S Corporation to C Corporation — Section 481 is amended by adding at the end the following new subsections:
(d) Adjustments attributable to conversion from S Corporation to C Corporation
(i) In general, in the case of an eligible terminated S Corporation any increase in tax under this chapter by reason of an adjustment require by subsection (a)(2) and which is attributable to such corporation’s revocation described in paragraph (2)(A)(ii), shall be taken into account ratably during the 6-taxable year period beginning on the … [last line cut off].”
What’s the big deal?
Just write the bill using blockchain. Remember, Oracle will be able to do its taxes on a postcard.
Ha! The estate tax elimination to prevent more Hiesenburgs https://www.washingtonpost.com/news/politics/wp/2017/12/04/why-arent-you-paying-the-estate-tax-maybe-because-you-bought-311000-bottles-of-whisky/?utm_term=.fba9e8e942dc