Why cut taxes now?
Is this the right time for one of you to quit your job and cut back on your income? Of course not. That would be insane, right?
Yet that appears to be exactly what the Trump administration and the Republicans are looking to do; and by doing so they will be adding to, not decreasing, our debt.
Aside from just the plain old debt which is now upwards of $18 trillion, we are suddenly faced with some major new, unexpected expenses. Texas, Florida, the U.S. Virgin Islands and Puerto Rico have been decimated by hurricanes. The cost to restore and repair these states and territories may very cost over $100 billion; maybe $200 billion. No one knows for sure, but all agree it'll be expensive.
The argument for cutting taxes now is that somewhere down the road this will spur more growth and we'll be able to grow our way out of debt. That sounds good, but it hasn't worked thus far. The pitch is (there is no legislation) that this will be a real windfall for the middle class. Donald Trump has emphatically declared that his plan will not help the rich, including him.
Like nearly all other declarations from Mr. Trump this, too, is a lie.
Doing away with the estate tax and the alternative tax alone would be of great benefit to him. We can't tell for sure just how much, because he's not released his tax returns. We are asked to trust him; a man who has proved time and again in less than nine months that he is completely untrustworthy. Based on the two pages of one of his tax returns that were leaked, he would've have saved $31 million on the alternative tax alone. I don't care who you are; that's a benefit. His family would save billions by eliminating the estate tax. He would like you to believe that he's proposing these cuts to help small businesses and the middle class, which, to some extent might be true. This group of taxpayers might get some crumbs, but the real beneficiaries are those who need help the least.
I'm not opposed to having my taxes reduced and neither are you. But what I am opposed to is reducing our revenues as a strategy to undermine government services, and that is what this plan is truly about. House Speaker Paul Ryan has been planning for this moment for years. If the Republicans can cut off the revenue, then they can cry that there's no money for programs that help people; like Social Security and health care programs.
The added benefit for them is that their donors would realize a huge windfall and would presumably be very happy; happy enough to give back some of that money to those who made the windfall possible. But helping the rich get richer has proved to not be of much help to the rest of us. National Economic Council director Gary Cohn, who cashed out from Goldman Sachs and made hundreds of millions of dollars, declared that the $1,000 a middle-class family will save would allow them to buy a car. Really?
Cutting taxes makes for great rhetoric, but doing so in our time of great need is irresponsible. There should be a better way to appease their donors besides bankrupting the country.
Bob Stannard lives in Manchester.
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