The numbers are in and guess what? The GOP’s “big, beautiful” tax bill accrues handsomely to the richest 10% of society, barely to the middle-class and not at all to the poorest Americans.
Shocking, I know. It’s almost as if the whole point of the legislation was to transfer even more of the country’s wealth to the top of the socioeconomic pyramid.
In response to a request from House Democrats including Hakeem Jeffries (who’s cultivating an “impressive” reputation for doing absolutely nothing to put the brakes on America’s fast-motion descent into illiberal, soft-authoritarianism), the Congressional Budget Office updated their estimates of the distribution effects from Donald Trump’s signature legislation as written in the lower chamber.
“In general, resources would decrease for households toward the bottom of the income distribution, whereas resources would increase for households in the middle and top of the income distribution,” CBO director Phillip Swagel said, in a Thursday letter to Jeffries.
I could leave it there. Because that’s really all you need to know. But the actual numbers (i.e., the CBO estimates) are worth mentioning because they underscore just how regressive this legislation really is.
As the figure below shows, the poorest Americans would see their annual income fall by $1,600, or 4%, under the House-passed version of the bill. That loss is attributable to Medicaid and food stamp cuts.
The richest Americans, by contrast, would enjoy a $12,000 boost to their annual incomes, or 2.3%, courtesy of a lower tax bill.
The impact varies for everyone in-between, where “varies” means the richer you are, the more favorable the bill treats you, as illustrated above. Under the bill, the middle-class would benefit to the tune of — and try not to laugh — a whole $500 per year.
To reiterate: This is openly — brazenly — regressive. It’s the old “rich get richer, poor get poorer” adage enshrined into law. Again.
Whether you believe debt and deficits matter for the US or not, it’s fair to suggest that issuing trillions in new Treasurys to cover the difference between the cost of upward transfer payments to the richest Americans and what can be had by shaking down the poorest, is bad policy. It’s also cruel. Cartoonishly cruel.
Oh, and for the would-be Ebenezer Scrooges and Marie Antoinettes among you, do be sure to know where on the income scale your family actually falls before proclaiming your support for this ridiculously flagrant reverse Robinhood scheme.
Ladening an org with debt to increase value for the already rich, kinda feels like stock buybacks in a way.
It’s the classic leveraged buy out strategy back from the dead. Makes sense that Trump would dial up a relic from the 80s as his go-to move.
Did they add in the impact of tariffs on the same cohorts? Or are they too much of an unknown at this point?
Perhaps some of the inequality will be offset as deportations drive up the costs for household helpers, live in nursing and, and worst of all, golf course and second home landscape services?
Playing around on the CBO interactive tool, one can toggle resource change by year. Interesting how front-loaded this is as well making the initial impact more pronounced. The average net change for first 4 years (2026-2029) to top 10% is $17k and for bottom 10% -$1k. Contrast that with last four years (2031-2034) to top 10% is $8k and to bottom 10% a -$2k.
Front load for maximum benefit upfront and setup a future narrative… when the next administration comes in (if, I should say) Americans will already be scheduled to receive less benefit than they would grow accustomed to which will feel like tax hikes.
https://www.cbo.gov/publication/61469
Bah humbug all around.
Does no taxes on tips benefit only the top 10%? Does no taxes on Social Security only help the wealthiest ? Just Asking for a friend. The fairest and least regressive tax would be a flat wealth tax, which I realize will never happen.
I would also favor means testing for Social Security benefits rather than it being an age based entitlement. Most of the wealth is in the older age demographic. Of course, I’m not suggesting that all the elderly are wealthy.
I’m not sure what you’re intimating with the two questions in your first comment. Nobody said “nothing in this bill helps anyone except the rich.” What people are saying is that when considered as a whole, the benefits accrue disproportionately to the rich which, again, is on purpose. I realize this is difficult for a lot of Trump voters to come around to (although I’m not sure why given his background) but he doesn’t care a single thing about regular people. If he did, he wouldn’t sell them NFTs of himself dressed as a pheasant hunter and Lee Greenwood co-branded Bibles.
Ok, I agree with that. When considered as a whole, the benefits do accrue disproportionately to the wealthy. And I agree that his various marketing schemes including cryptocurrencies are embarrassing.
Add to all this the reduction of public services benefitting the average income. Libraries, hospitals, USPS, food safety, vaccines, more pollution, dirtier water. Cut taxes but raise fees to have a picnic in a filthy unmaintained campground.
H-Man, so the fat cats feed on the fish, and the rest of us feed on road kill. Tell me what is new?
Exactly, it’s not new. Look at the distribution of wealth in this or any DM (not even a question in authoritarian regimes). More and more of the pie goes to a smaller and smaller segment of the population. This is true in all forms of government, with countries running capitalism the best of a bad lot. The oligarchs of this country run the show, just look at the inauguration photos. For too many of the uber rich, they never have enough. They have far too big a say in who wins elections these days and they typically back candidates who promise they’ll get an even bigger cut. Or said another way, ‘the rich get rich and the poor get poor’.
Looking forward to your analysis of Israel bombing Iran’s nuclear facilities.
Never underestimate the power of the average American to believe that they are just one scratcher away from riches beyond belief and an invite to the Met gala. That’s how the GOP gets away with this stuff. “Sure, i’m poor now, but tomorrow…”
yeah. “temporarily embarrassed millionaires”