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Trump's Tax Plan Is a Confidence Scam

By       Message Robert Borosage       (Page 1 of 2 pages)     Permalink    (# of views)   4 comments

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From Our Future

From youtube.com: Is Trump Dumb or a Liar? {MID-157265}
Is Trump Dumb or a Liar?
(Image by YouTube, Channel: David Pakman Show)
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Donald Trump traveled to Springfield, Missouri to kick off the administration's next big initiative: cutting taxes. Here was the essential Trump, the confidence man, peddling a plan that does not yet exist on paper. Populist bluster was deployed to cover for what will be a one-percenter's elixir.

Each of the four principles Trump claims will inform what he calls "tax reform" is actually mocked in the plans the administration is cooking up behind closed doors.

The only question is whether Americans are gullible enough to buy what Trump, House Speaker Paul Ryan and Republicans are selling. And whether Democrats will unite to expose the con and demand progressive tax reforms that are long overdue.

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Simplicity?

Trump's first principle is simplicity: the tax code should be "simple, fair and easy to understand." But Republicans aren't interested in simplicity. They are interested in cutting taxes, particularly for the wealthy and the corporations, and starving the government of revenue.

This sets up their argument for the necessity of slashing popular government programs -- from Medicare, Medicaid and Social Security to disaster relief, investment in education and environmental protections.

Were simplicity the actual goal, Trump would promise a plan that was revenue neutral, or given the current deficits, produced more revenue, by closing loopholes and shutting down tax dodges. The words never crossed his lips.

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Cutting Corporate Taxes

The second "principle" is to cut corporate taxes. With corporate profits a record percentage of the GDP and revenue from corporate taxes at record lows, this isn't exactly a compelling cause. So, this goal is spun as a way to make corporations competitive, creating more jobs and higher wages.

Every part of this argument is a lie. Corporations pay far lower effective tax rates than the nominal rate. And as a new study by the Institute for Policy Studies shows, the corporations that already pay at the lower 20-percent rate Republicans are peddling have cut, not created, jobs over the last nine years.

And while cutting corporate taxes lines the pockets of shareholders and CEOs, workers suffer job loss and pay stagnation.

Tax Relief?

The third principle is "tax relief for middle class families." Whenever politicians start talking about cutting taxes on the middle class, hold on to your wallet.

In every version of Trump tax plans that have been made public, the richest 1 percent pocket nearly half or more of the tax breaks. In the most recent plan, the top one-tenth of 1 percent would enjoy a tax break of over one million a year.

The average taxpayer in the middle would pocket about $1,000. Trump argues that these "forgotten people" will get the pay raise they've been waiting for, and "do lots of things with their paychecks." Yeah, like making a nominal payment on the record credit card debts, and auto and school loans that burden them. This is a heist. The Trump tax cuts will overwhelmingly benefit the few and the corporations. The middle class is offered a pittance simply to make the dish palatable.

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"The American Model"

The fourth principle is the most outrageous: Trump promises to create "the American model" by bringing back trillions in wealth parked overseas. Large corporations have indeed booked trillions of profits overseas to avoid paying U.S. taxes. The numbers are staggering: an estimated $2.5 trillion, with $700 billion in owed taxes.

But does Trump's "America Model" require these corporations to pay the taxes that they owe?

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Robert L. Borosage is the president of the Institute for America's Future and co-director of its sister organization, the Campaign for America's Future. The organizations were launched by 100 prominent Americans to challenge the rightward drift (more...)
 

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