Wasn’t this supposed to be for the middle class?
When Donald Trump was elected president last year, a sweeping rewrite of the tax code was one of his top priorities.
Throughout the campaign, Trump said he wanted a “middle-class tax cut,” one that wouldn’t benefit wealthy people like him and would spur huge levels of economic growth while not adding to the national debt. “For the hedge fund guys, they’re going to be paying up,” Trump promised in September 2015.
As president, Trump has continued to insist the tax code overhaul won’t be good for himself or other millionaires. “This is going to cost me a fortune, this thing ― believe me,” Trump said this week.
But the big winners in the GOP bill that the Senate passed early Saturday morning are corporations and the wealthy. Trump himself ― a self-proclaimed billionaire ― stands to gain millions through the elimination of certain taxes (though we don’t know exactly how much because Trump won’t release his tax returns). Far from being a middle-class tax cut, the measure is a massive corporate giveaway, a bill that recycles decades of Republican ideology on trickle-down economics and trusts that executives will hand over their new gains to average-income workers.
“If my friends here want to give a tax cut to the middle class,” Sen. Sherrod Brown (D-Ohio) asked on the Senate floor Thursday, “why don’t we give a tax cut to the middle class?” His argument had no effect.
After months of negotiations, the Senate passed the proposal, 51-49, with just one Republican ― Bob Corker of Tennessee ― joining all Democrats in opposition. Corker took issue with how much debt the bill would produce, and after the Senate parliamentarian struck down Corker’s debt-control proposal, GOP leaders invited the retiring Republican to just vote no rather than finding him an accommodation.
With the bill finally through the Senate ― the House passed its tax bill two weeks earlier ― the two chambers still have to work out their legislative differences in a conference committee before the tax rewrite becomes law. There’s a slim chance the House could adopt the Senate bill and send it to the president’s desk, but it’s more likely that negotiators will merge the two versions. Both chambers need to pass the same measure for the bill to become law.
For most Americans, the legislation is still indeed ― at least in the short term ― a tax cut. Those cuts are due in large part to Republicans approving $1.5 trillion in added debt over the next 10 years. But of that pie, the wealthy disproportionately benefit, and some households could wind up with higher tax bills. The richest 20 percent of households reap 90 percent of the benefit of the tax cuts over that time period, according to the nonpartisan Tax Policy Center.
Still, in the short term, it’s difficult to say exactly whose taxes go up and whose go down. Tax burdens depend on what deductions individual filers claim, and this bill is a complicated tax code rewrite ― one that analysts say will have limited impact on the economy, will cost the nation more than a trillion dollars over the next 10 years, and will do much more for rich investors than it will the middle class.
Despite all that, despite poll after poll showing the measure is unpopular, most Republicans were ecstatic to pass the bill.
While the bill took months to draft, the final package came together over a frenetic last few days. Republicans didn’t even have finished legislative text until Friday night, hours before the vote, and Democrats slammed their GOP colleagues for rushing through a bill that was cobbled together with handwritten changes and crossed-out pages at the last minute.
