If President Donald Trump and Republicans in Congress had set out to caricature their own worst instincts, they could not have outdone their proposed tax overhaul.
It’s a bonanza for their political donors and — how tacky is this? — for Trump and his family. It will balloon the federal deficit, widen economic inequality and give Republicans an excuse to take an ax to Medicare, Medicaid and Social Security.
Sweeping changes are being rushed through on party-line votes with little debate or analysis because Trump and Republicans are desperate for a win and their donors are getting restless.
Surely the last 40 years have taught us:
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▪ Trickle-down economics is a fantasy.
▪ Soaring deficits smother economic growth by forcing businesses to compete with the government to borrow money.
Republicans ignore these lessons as they pretend their plans will benefit working people and the middle class. Under their theory, corporations and wealthy individuals will use their tax windfalls to create jobs by expanding businesses. In reality, the windfalls will go to stockholders in the form of dividends and to executives who will redistribute the wealth to yacht dealers and real estate brokers.
The Republican tax overhaul is so deeply skewed to benefit the wealthy that it’s hard to believe it’s real. Trump ran a populist campaign, vowing to restore economic security to working people who suffered as this country’s wealth has flowed in recent decades to the top. What Trump is backing makes a mockery of his promises to blue-collar voters.
The House has already approved a sweeping bill, one that penalizes young people and college towns like Lexington by taxing graduate students’ tuition waivers and ending the deductibility of student debt. By the time you read this, Majority Leader Mitch McConnell’s Senate may also have joined the sham, even though an analysis by the nonpartisan Congressional Budget Office found that the Senate bill would leave the nation’s poorest people worse off while adding $1.4 trillion to the deficit over the next decade.
In Kentucky, one of the poorest states, a plan that harms poor families should be a non-starter. Yet Sen. Rand Paul, sometimes a GOP maverick, has signed on. No Kentuckians were among the 13 Republicans who voted against the House tax bill. Reps. Andy Barr, Hal Rogers, James Comer, Brett Guthrie and Thomas Massie all voted for it. Only Democrat John Yarmuth of Louisville voted no.
During his campaign, Trump said “the rich will pay their fair share.” Yet the Senate bill would deliver 62 percent of its net tax cuts in 2027 to just the wealthiest 1 percent of households. By comparison, the tax cuts approved by Congress in 2001 and 2003 under Republican President George W. Bush, delivered 27 percent of their benefits to the top 1 percent when fully phased in, according to the Tax Policy Center.
Republicans are pretending their tax cuts will pay for themselves as trickle-down fairies sprinkle prosperity across the land. Their fantasy would be a nightmare for average Kentuckians. Republicans should wake up in time to avoid caricaturing themselves as budget-busting servants of the rich.