A Christmas Miracle: Treasury Creates $1.8 Trillion In 470 Words

So there are a lot of inconvenient things about the GOP tax plan, starting with the fact that it has been continually pitched as a “middle class miracle” when in fact, independent analysis overwhelmingly shows it disproportionately benefits corporations and the rich.

That’s not exactly surprising considering the source. And I guess it’s not surprising that Republicans would obfuscate about it. After all, they’re going to keep pushing trickle down economics no matter how many times it fails. What’s particularly nefarious this time around though, is the extent to which lawmakers are bald face lying to middle class families in an effort to help Trump perpetuate the populist myth that got him elected.

The numbers are in on this and it is anything but a “middle class miracle.” Of course Republicans know that, but they also know that middle class families aren’t going to do any actual research on this, so the GOP gets to go ahead and push false hope.

Worse still is Trump’s insistence that the tax plan isn’t good for him and his friends (“believe me”). That is manifestly untrue. We’ve been over this before (here’s the math), but just to reiterate, here’s a quick summary from The Atlantic:

“This is going to cost me a fortune, this thing–believe me,” Trump said this week. “Believe me, this is not good for me. Me, it’s not–so‚ I have some very wealthy friends, not so happy with me, but that’s okay.”

This is not true. In fact, Trump stands to benefit to the tune of hundreds of millions, if not billions, of dollars, according to tax analysts, though it is hard to know with much specificity, given that he refuses to release his tax returns and House and Senate Republicans keep tinkering with the legislation. The elimination of the alternative minimum tax. The changes to the estate tax. Abbreviated depreciation schedules. Deductions or special rates for pass-through businesses. All these provisions stand to benefit Trump directly. Indeed, tax experts have said that as a real-estate developer he seems uniquely positioned to benefit from tax reform.

As if all of that weren’t enough, Republicans are clinging to the notion that this isn’t going to balloon the deficit. After all, they’re supposed to be the party of fiscal responsibility.

When you throw in everything said above what you end up with is a plan that actually increases the burden on future generations (higher national debt) in order to finance a better lifestyle for rich people and in order to placate corporate “citizens” at a time when the wealth divide is already increasing. Basically, this tax plan is evil incarnate (that’s hyperbole, but you get the idea).

Well on Monday, the Treasury released a one-page (yes, one page) document that purports to explain how this is ultimately going to pay for itself and hilariously, the math depends on a whole host of things that haven’t happened yet like infrastructure spending and de-regulation. Here’s an excerpt:

OTP has modeled the revenue impact of higher growth effects, using the Administration projections of approximately a 2.9% real GDP growth rate over 10 years contained in the Administration’s Fiscal Year 2018 budget. 2 OTP compared this 2.9% GDP growth scenario to a baseline of previous projections of 2.2% GDP growth. Treasury expects approximately half of this 0.7% increase in growth to come from changes to corporate taxation. We expect the other half to come from changes to pass-through taxation3 and individual tax reform, as well as from a combination of regulatory reform, infrastructure development, and welfare reform as proposed in the Administration’s Fiscal Year 2018 budget.

That is so laughable that it eludes attempts to explain how laughable it is. There’s no way to quantify the impact of things that still largely exist only in Donald Trump’s head. 

This memo is all of 470 words long. In other words, it’s shorter than the blog post you just read. And supposedly, we’re supposed to take it seriously.

Read it below for yourself and don’t forget to laugh at the notion that all of the economists who have maligned the tax plan are going to be convinced by what amounts to a bunch of cobbled-together talking points.