GOP lawmakers are planning an historic transfer of wealth that favors the privileged and squeezes the less-advantaged.
For Christmas, President Trump and the Republican Congress hope to borrow money from our children in order to give huge tax cuts to corporations and the rich. If they succeed, they will continue a long Republican tradition of Robin-Hood-in-reverse, and the country will lose as a result.
Over the past forty years, ordinary Americans’ incomes have stalled, while those at the very top have soared. The country has gotten richer overall, but the benefits have gone almost entirely to those at the very top – and since the year 2000, these trends have accelerated.
Lower taxes on the very wealthy have strongly contributed to these trends. Beginning in the 1980s, Republicans repeatedly cut taxes for the rich and big corporations. In 1973, the top one percent took eight percent of all income (after taxes) while the bottom 50 percent got a mere 25 percent. But inequality has gotten worse since. The top one percent has almost doubled its share of national income to 15 percent, while the share of the bottom 50 percent has shrunk by a quarter to 19 percent. Meanwhile, corporate taxes plunged from over 30 percent of all tax receipts in the 1950s to under 10 percent by the mid-2000s. While Obama modestly increased taxes for the rich, the overall picture hasn’t changed much―the rich get richer while paying lower taxes than in the past.
Now, the Republican tax plan proposes more of the same. Steep cuts in personal income and corporate taxes will mainly benefit the extremely wealthy. In fact, the richest five percent will receive half of all the benefits. Among other changes, the Republican plan slashes the corporate tax rate from 35 percent to 20 percent, eliminates taxes on estates larger than $5.45 million, and abolishes the Alternative Minimum Tax, which ensures that wealthy taxpayers with large deductions pay at least a minimum rate. These changes are designed to help people like Donald Trump, not people like you and me.
