RepubliKlan Tax Cuts for Über Rich same policy caused 1929 Great Depression

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The GOP tax bill is straight out of 1929
Republicans are again sprinting toward an economic cliff
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By Robert S. McElvaine |November 30, 2017

Historian Robert S. McElvaine teaches at Millsaps College. He is the author of "The Great Depression: America, 1929-1941" and currently at work on a novel.

https://www.washingtonpost.com/news...rian-the-gop-tax-bill-is-straight-out-of-1929



“There are two ideas of government,” William Jennings Bryan declared in his 1896 “Cross of Gold” speech. “There are those who believe that if you will only legislate to make the well-to-do prosperous their prosperity will leak through on those below. The Democratic idea, however, has been that if you legislate to make the masses prosperous their prosperity will find its way up through every class which rests upon them.”

That was more than three decades before the collapse of the economy in 1929. The crash followed a decade of Republican control of the federal government during which trickle-down policies, including massive tax cuts for the rich, produced the greatest concentration of income in the accounts of the richest 0.01 percent at any time between World War I and 2007 (when trickle-down economics, tax cuts for the hyper-rich, and deregulation again resulted in another economic collapse).

Yet the plain fact that the trickle-down approach has never worked leaves Republicans unfazed. The GOP has been singing from the Market-is-God hymnal for well over a century, telling us that deregulation, tax cuts for the rich, and the concentration of ever more wealth in the bloated accounts of the richest people will result in prosperity for the rest of us. The party is now trying to pass a scam that throws a few crumbs to the middle class (temporarily — millions of middle-class Americans will soon see a tax hike if the bill is enacted) while heaping benefits on the super-rich, multiplying the national debt and endangering the American economy.

As a historian of the Great Depression, I can say: I’ve seen this show before.

In 1926, Calvin Coolidge’s treasury secretary, Andrew Mellon, one of the world’s richest men, pushed through a massive tax cut that would substantially contribute to the causes of the Great Depression. Republican Sen. George Norris of Nebraska said that Mellon himself would reap from the tax bill “a larger personal reduction [in taxes] than the aggregate of practically all the taxpayers in the state of Nebraska.” The same is true now of Donald Trump, the Koch Brothers, Sheldon Adelson and other fabulously rich people.

During the 1920s, Republicans almost literally worshiped business. “The business of America,” Coolidge proclaimed, “is business.” Coolidge also remarked that, “The man who builds a factory builds a temple,” and “the man who works there worships there.” That faith in the Market as God has been the Republican religion ever since. A few months after he became president in 1981, Ronald Reagan praised Coolidge for cutting “taxes four times” and said “we had probably the greatest growth in prosperity that we’ve ever known.” Reagan said nothing about what happened to “Coolidge Prosperity” a few months after he left office.

In 1932, in the depths of the Great Depression, Franklin D. Roosevelt called for “bold, persistent experimentation” and said: “It is common sense to take a method and try it; if it fails, admit it frankly and try another. But above all, try something.” The contrasting position of Republicans then and now is: Take the method and try it. If it fails, deny its failure and try it again. And again. And again.

When Bill Clinton proposed a modest increase in the top marginal tax rate in his 1993 budget, every Republican voted against it. Trickle-down economists proclaimed that it would lead to economic disaster. But the tax increase on the wealthy was followed by one of the greatest periods of prosperity in American history and resulted in a budget surplus. When the Republicans came back into power in 2001, the administration of George W. Bush pushed the opposite policies, which had invariably produced calamity in the past. Predictably, that happened again in 2008.

Just how disastrous would the proposed reincarnation of t f the failed Republican trickle-down policies of the past be for the American people and the future of the nation? A few ways:

  • Repealing the estate tax, or, as Republicans have dubbed it, the “death tax.” But the estate tax is not a tax on the dead; it is a tax on their heirs. Repeal would reverse an important aspect of the American Revolution and establish an American hereditary aristocracy. If your estate is not above $11 million, your benefits from this portion of the GOP’s tax cut will be a nice round number: zero.
  • Eliminating deductions for state and local taxes. The GOP has called these deductions favoritism for people who live in high-tax states. In fact, ending deductibility of state and local taxes would tax income that has already been taxed away from a taxpayer. It is, quite simply, double taxation.
  • Repealing the Alternative Minimum Tax, which assures that wealthy people who hire accountants to find all the obscure ways to avoid taxes cannot escape taxation altogether. Repealing it would save Trump millions.
  • Extending the “pass-through” provision to noncorporate businesses, including some 500 entities Trump owns. It would allow the owners of these businesses to pay taxes at 25 percent, instead of 39.9 percent. This provision would allow Wall Street fund managers, among other very wealthy people, to pay a lower tax rate than many middle-class Americans pay.
  • Ending the deductibility of large medical expenses.
  • Taxing waived tuition for college students, ending deductibility for student loan payments, and even disallowing teachers from deducting what they spend on school supplies for their students.
  • Ending the Affordable Care Act’s individual mandate, which would cause 13 million Americans to lose health insurance and result in much higher premiums for those who do get insurance through the exchanges. The Congressional Budget Office has indicated that, if enacted, the Republican tax bill may force deep cuts in Medicare through a generally unknown budget rule that its deficits would trigger.

In short, no. The president would benefit mightily from either version of the GOP tax bill.(Meg Kelly/The Washington Post)

The analysis of the nonpartisan Congressional Budget Office found that people making less than $100,000 a year (approximately 80 percent of American households) will have their taxes increased while the millionaires and billionaires will make off like bandits.

In the 1920s, Republicans were in full control of the federal government and used that power to pursue their objective to “make the well-to-do prosperous.” It didn’t “leak through on those below.” In that decade, the mass-production American economy became dependent on mass consumption. For it to work, the masses need a sufficient share of the national income to be able to consume what is being produced.

Republican policies in the ’20s instead pushed to concentrate more of the income at the top. Nine decades later, Republicans are rushing to do it again — and they are sprinting toward an economic cliff. Another round of Government of the People, by the Republicans, for the super-rich will be catastrophic. The American people must call a halt before it’s too late.

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QueEx

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Policy: Finance & Tax


Tax bill a dream come true for some GOP wonks
Republicans are on the cusp of a historic victory for their tax-cut agenda.


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When he became Speaker, Paul Ryan said he was reluctantly passing the title of Ways and Means chairman, and the opportunity to focus his attention on tax reform, to another member. | Alex Wong/Getty Images

Politico
By BERNIE BECKER
12/17/2017 06:58 AM EST
Updated 12/17/2017 09:00 AM EST


For the large contingent of Washington supply-siders and tax cutters, the sweeping tax overhaul that President Donald Trump is poised to sign into law this week has been a generation in coming -- and the culmination of half a life’s work that started during Ronald Reagan’s 1980s.

Grover Norquist, arguably the best-known anti-tax activist in the country, started Americans for Tax Reform at then-President Reagan’s request to help marshal support for the 1986 tax overhaul. He's been working ever since to rally support for more tax cuts.

House Speaker Paul Ryan (R-Wis.) for years said his dream job was to be House Ways and Means chairman, a position that would have allowed him to quarterback the sort of tax revamp that his mentor, the late Jack Kemp, helped get through Congress in 1986.

When he became Speaker, Ryan said he was reluctantly passing the title of Ways and Means chairman, and the opportunity to focus his attention on tax reform, to Rep. Kevin Brady (R-Texas).

Now, the 2017 tax revamp will bring the American tax system more into lockstep with those conservatives’ thinking than perhaps ever before – making the idea that what works for corporate America will work for the country-at-large a central plank of U.S. policy for decades to come, maybe even another generation or more.

“This tax cut and reform will drive further reforms and reductions for the next 50 years,” Norquist said Friday.


The corporate rate would get slashed from 35 percent to 21 percent under the GOP plan, which would also allow businesses to immediately write off investments for five years and scrap Obamacare’s individual mandate. In an extra bonus for the right, it also shrinks the deduction for state and local taxes, an incentive that mostly helps blue, high-tax states.

“This is a pretty historical moment for the conservative movement,”
said Stephen Moore, another of those supply-siders, who has over the years worked at the Club for Growth, the Heritage Foundation and The Wall Street Journal editorial page.

“I’ve been in this game for 30-some years. This, if it passes, will be the single biggest policy triumph for conservatives since the 1996 welfare reform. It’s up there with the ’81 Reagan tax cuts,”
added Moore, who’s an informal adviser to the president and, along with fellow supply-sider Larry Kudlow, helped then-candidate Trump craft his tax plan.

The start of the conservative tax-cutting movement is frequently traced back to 1974, when a young economics professor named Art Laffer met with an equally young Dick Cheney, then a top aide to President Gerald Ford. Meeting at a bar, Laffer doodled the case that cutting taxes can increase revenues for the government on a napkin, a theory now known as the Laffer Curve.

That case is maybe most famously argued by Kudlow, who worked in Reagan’s White House and has spent more than 15 years defending its merits on CNBC. Perhaps even more importantly, Moore said, Kudlow worked overtime to pitch the GOP tax plan to skeptical Republicans like Sens. Susan Collins (R-Maine) and Bob Corker (R-Tenn.), both of whom now seem likely to back the measure.

It might be hard to imagine now, but the Republican Party hasn’t always been dominated by would-be tax cutters. Former Senate Majority Leader Bob Dole (R-Kan.) once joked that “the good news is that a bus full of supply-siders went off a cliff. The bad news is that two seats were empty,” according to “Showdown at Gucci Gulch,” the book about the 1986 tax overhaul.

But the supply-side theory eventually won out, if in fits and starts. Reagan’s 1981 tax package cut the top individual rate from 70 percent to 50 percent – with the rate getting down all the way to 28 percent in 1986.

Republicans now credit those 1981 tax cuts with sparking years of economic growth, higher wages and job creation. But with the economy floundering in 1982, Dole and other Republicans pushed through a tax increase. And Democrats have long said that there was no trickle in the GOP’s “trickle-down economics,” pointing to a 1990s economic boom that happened after President Bill Clinton raised taxes.

Conservatives believe the growth had more to do with a cut in the capital gains rate under Clinton’s watch, which itself was followed several years later by the two rounds of tax cuts under George W. Bush.

Now, 15 years later, all that work by supply-siders has culminated in a new kind of tax reform, which marries the theory that tax cuts for business will be a boon for the economy with tax reform’s traditional discarding of various tax incentives that have collected over the years, which they say distorts the economy.

Marty Sullivan of Tax Analysts said the 2017 tax overhaul looks more like the 1981 and 2001 tax cuts enacted under Republican presidents, as opposed to tax overhauls in 1969, 1976 and 1986. The 1986 tax reform, while lowering the top corporate rate from 46 percent to 34 percent, actually hiked taxes on corporations to pay for tax relief for individuals, and to keep from adding to deficits.

“Those were all workman-like reforms where the staff and members looked hard for unfair and complicated tax breaks to take out of the code to simplify it, make it fair and reduce rates,” said Sullivan, a former economist for both the Treasury Department and the Joint Committee on Taxation. “In this bill, tax cutting is the primary motivation and reform is an afterthought.”

The next question is whether this bill will jolt the economy like its supporters say. Trump and other top Republicans have said that the economic growth created by the tax cuts will more than offset its current $1.456 trillion price tag.

But while outside analysts and JCT have found that the Republican tax plan would create hundreds of billions of dollars in new revenue, none of them have found that the plan would come close to paying for itself. On top of that, Democrats are already making it clear that they’ll do everything in their power to unwind this year’s tax bill, especially if they win back some power in Washington next year.

“One of the lessons of ‘86 is it’s really hard to get tax reform, but it’s even harder to keep it,” said Douglas Holtz-Eakin, a former Congressional Budget Office director and president of the conservative American Action Forum. “I think it’s a concern. The partisan nature makes it ripe for change the moment the Democrats get the opportunity.”

For their part, conservatives say they’re in better shape than ever to protect the new tax cuts.

Republicans were united against former President Barack Obama’s efforts to allow Bush-era rates for the wealthy expire, though they weren’t successful in the end, and Norquist notes that bipartisan efforts that erased parts of the 1986 tax overhaul came before practically all GOP lawmakers were signing his organization’s pledge against tax hikes.

But Moore also called the 2017 tax cuts a “riverboat gamble,” echoing the late Senate Majority Leader Howard Baker’s thoughts on the 1981 Reagan tax cuts. Their success or failure, Moore added, will have a big impact on whether the supply-siders’ influence grows or diminishes over the next generation.

“We say it will work, and they say it won’t and this will be put to the test,” Moore said. “If this doesn’t work, I’ll eat some crow.”



https://www.politico.com/story/2017/12/17/trump-tax-plan-republican-victory-233947


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COINTELPRO

Transnational Member
Registered
The Democrats could have done this cut the corporate tax rate and left the income tax rate for the billionaires and millionaires high. Companies will either use the money to reduce prices, expand, or increase wages. It could extend the life of companies that eventually go bankrupt and close down like GM. Imagine GM with a 20% or less tax rate over 40 years.

Because of the racial politics that will be used, we will never get a social safety net like Europe. Whites who control most employment situations can simply lay off one of us off and hire them when they need a job. We were stuck in between a high tax rate of companies that reduces available jobs and no substantial safety net system.

Components of Obamacare are already being dismantled, it took the first black president to expand this and other programs, meanwhile white Democrats just seem to have problems getting it done and just flop around. If anything, they are rolling back welfare protections, signing free trade deals, and other measures. They attack cutting the corporate rate, claiming it will go towards share buybacks boosting the pay of CEO.



We are being rain made by the progressives, claiming to provide free education, healthcare, childcare housing assistance which never gets done, while the tax rate on companies remains high. Meeting us in the lobby pretending to be an important official with the agency.

 
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COINTELPRO

Transnational Member
Registered


Many of these New Deal social assistance programs were setup when minorities were a much smaller percent of the population and the country was under a separate but unequal doctrine. You could not get a guaranteed mortgage or denied Social Security in occupations dominated by African Americans. Many of these programs were administered favoring whites heavily.

Than Lyndon Johnson/MLK Civil Rights plus Brown v Board of Education ruling came down that disallowed separate but equal.
 
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QueEx

Rising Star
Super Moderator
Business

Democrats balk as Republicans try to use must-pass spending bill to fix tax law


Washington Post
Erica Werner
March 16, 2018

Republicans aiming to use an upcoming spending bill to fix a glaring problem with their recently passed tax overhaul are running into a wall with Democrats, who were shut out of the tax law process and now don’t want to cooperate unless they get something in return.

Shortly after the rushed passage of last year’s $1.5 trillion tax law, agricultural companies warned that their livelihoods were imperiled after language in the legislation gave a major advantage to their competitors — farming cooperatives — in the heart of America’s agriculture economy. Republicans professed surprise and promised to fix the problem as soon as possible.

“It has to get fixed,” said Rep. K. Michael Conaway (R-Tex.), chairman of the House Agriculture Committee. “I mean, it’s essential.”

But Democrats aren’t willing to go along so easily. They say they warned Republicans that pushing through the law in a matter of weeks — without public hearings — would result in problems and unintended consequences. And now that such issues are emerging, some Democrats resent being asked to lend their votes to a solution.

“They were forewarned that issues of this magnitude, including the co-op issue, could’ve been fully vetted. And now they want us to help them correct what they assured us did not need correction,” said Rep. Richard E. Neal (Mass.), the top Democrat on the tax-writing Ways and Means Committee. “You cannot rewrite the revenue system of the country in five weeks without any hearings, without any witnesses, and not expect the glitches that we’re now beginning to see.”


The dispute carries echoes of the partisan grudge match that followed passage of the Affordable Care Act, when fuming Republicans refused to entertain fixes to the health law, focusing instead on numerous failed efforts to repeal it. The ACA process was much lengthier and more transparent than the writing of the tax bill, but both pieces of legislation ended up passing along party lines.

Republicans now want to fix the tax law as both sides seek the political upper hand in this year’s midterm campaigns. Democrats are celebrating an apparent victory in a Pennsylvania special election this week in a GOP district, where Republicans pulled back ads focused on the bill in the waning days of the election.

Although Republicans continue to argue that the law is a political winner for them, some Democrats took the outcome in Pennsylvania as evidence that the GOP tax message doesn’t work, buoying their own opposition to the law.

Democrats are arguing that the law disproportionately helped the wealthy over middle-class Americans, and that corporations are pouring gains into stock buybacks rather than wage increases for workers.

Against that backdrop, GOP efforts to engineer a fix to what’s being called the “grain glitch” in the tax law take on a political dimension that empowers Democrats to play hardball.


Democratic votes are needed on the government-wide spending bill that must pass by March 23 at midnight to stave off a third federal shutdown this year. In exchange for including a fix to the grain glitch in the omnibus spending bill, Senate Democrats are pushing for inclusion of a tax provision of their own, an affordable-housing tax measure championed by Sen. Maria Cantwell (D-Wash.).

Some Republicans are resistant to adding the Cantwell provision, and the dispute is among a number of unsettled issues that will have to be resolved by top House and Senate leaders of both parties in coming days, before the omnibus legislation is released, which could happen Monday.


The spending bill is one of the few must-pass pieces of legislation Congress will consider this year, making it the favored vehicle for any number of unrelated issues to hitch a ride, from health care and immigration to a disputed transportation project to serve New York City that’s opposed by President Trump.


https://www.washingtonpost.com/busi...77aa4dab9ef_story.html?utm_term=.ae2b58a7b9d1


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