Taxes

CBO: The GOP Tax Bill is Worse Than Previously Reported

JM Ashby
Written by JM Ashby

The Congressional Budget Office (CBO) has analyzed the Senate Republican tax cut bill and found that it would negatively impact every American making less than $30,000 even before various provisions expire.

via CNBC:

The lowest-income American households would take a hit while higher-earning taxpayers would see their burden reduced under the Senate Republican tax plan, according to the latest analysis from the nonpartisan Congressional Budget Office. [...]

In 2019, all income groups under $30,000 would have a bigger burden under the bill, the CBO projected. In 2027, that would extend to all income groups under $75,000, as individual tax reductions expire.

Like previous reports, this includes the effects of repealing the individual mandate included in Obamacare, but this report also includes the automatic cuts to Medicaid and Medicare the bill would trigger.

Republicans say those cuts won't actually happen because they'll reverse them before it comes to that, but I see no reason to place any confidence in them. Why should we expect they'll avert automatic cuts to Medicaid when they've been trying to cut it by a trillion dollars every year since Obamacare was signed into law?

Whether or not the tax bill passes may come down to a handful of Republican senators acknowledging the truth or lying to themselves. But I suppose that's what every Republican bill comes down to.

  • ninjaf

    This is a feature, not a bug. The average Trump supporter does not make this little of money (I believe I read after the election that they averaged in the neighborhood of $70,000-$80,000/year) and it does exactly what I have heard conservative media blather on and on about wanting to do: make those poor, “lazy” slobs who don’t make enough money to live on pay for their sins of not being financially successful enough.

    We see this as a travesty; conservatives do not.

    • Badgerite

      Maybe the average, but quite a lot of them make well under that and they will be hurt by this. What’s more, it will be a drag on the economy as we are a volume economy dependent on consumer spending.

      • ninjaf

        Definitely.

  • Badgerite

    What is really disgusting about this proposed tax ‘reform’ is that its stated purpose of ‘creating’ jobs is really pie in the sky bullshit. When administration people say things like “this tax cut is necessary for the United States to leap frog over the competition’ what are they talking about really? The ‘competition’ is cheap labor abroad. And there is only one way to “leap frog” over cheap foreign labor and that is automation. Machines, in the long run, are even cheaper than cheap foreign labor and don’t need any time off. So what they are talking about is not investment in the country like infrastructure spending or spending on education. What they are talking about is making American goods competitive in world markets through automation. Globalists? For the overwhelming majority of Americans, middle class mostly, how does that ‘create’ anything.
    And these tax cuts are not even targeted toward businesses that manufacture anything. Casino magnates will get whopping tax cuts as well and they will certainly not ‘invest’ that in anything but themselves.
    And for those who don’t realize how depriving the middle class, where most of America lives, of money to actually spend will constrict our economy please read the following article in Business Insider by Henry Blodget.
    Sorry, Folks, Rich People Don’t Actually ‘Create The Jobs’.
    http://www.businessinsider.com/rich-people-create-job-2013-11
    “Entrepreneurs and investors like me actually don’t create the jobs — not sustainable ones, anyway.
    Yes, we can create jobs temporarily, by starting companies and funding losses for a while. And, yes, we are a necessary
    part of the economy’s job-creation engine. But to suggest that we alone are responsible for the jobs that sustain the other 300 million Americans is the height of self-importance and delusion.
    So, if rich people do not create the jobs, what does?
    A healthy economic ecosystem – one in which most participants, especially the middle class, have plenty of money to
    spend.
    Over the last couple of years, a rich investor and entrepreneur named Nick Hanauer has annoyed all manner of rich investors and entrepreneurs by explaining this in detail. Hanauer was the of online advertising company aQuantive, which Microsoft bought for $6.4 billion.
    What creates a company’s jobs, Hanauer explains, is a healthy economic ecosystem surrounding the company, which starts with the company’s customers.
    The company’s customers buy the company’s products. This, in turn, channels money to the company and allows them to
    hire employees to produce, sell and service those products. If the company’s customers and potential customers go broke,
    the demand for the company’s products will collapse. And the company’s jobs will disappear, regardless of what the entrepreneurs and investors do.”
    Yes, that’s it exactly. For our domestic economy. This tax cut legislation which basically raises taxes on the customer base of all businesses in the US only makes sense for a company that is global and who can automate and lower prices to compete with cheap labor foreign made products globally. It will not create any ‘jobs’. It will make money for a small group of people who dump money into campaign because they have most of the money already. That is about it.

  • muselet

    High-income individuals get their taxes cut under the Senate Rs’ tax bill, while everyone else’s taxes are raised. Government services will have to be cut because of the shortfall caused by the tax bill. Millions will be worse off while a few thousand make out like the proverbial.

    Every denizen of every Righty think tank just grew a third leg.

    –alopecia

  • Dread_Pirate_Mathius

    They don’t have the balls to actually do it. It’s an act of political suicide and they know it.

    Republican voters who receive benefits imagine that they are the only proper recipients and that everyone else on the dole is a pathetic mooch gaming the system. They want their representatives to take a way other people’s goodies.. but god help any congressman who touches a Republican voters’ rightful goodies.

    At the end of the day, screwing your base works great for the Red Team as long as there’s no tangible and specific way to prove they did it. But this one hits directly at their wallets, and there would be hell to pay.

    They aren’t going to tie a boat anchor to their own necks.

    • Wildson

      Their Red Team are their donors. Others are pansies, nothing more…

    • muselet

      Righty media convinced The Base that their taxes rose sharply under Barack Obama.

      Righty media will convince The Base that their taxes went down under Donald Trump.

      –alopecia

      • Nefercat

        Sad but true.

    • Tony Lavely

      I wish I believed they were smart enough to connect those two dots. However…

    • Victor the Crab

      Don’t be so sure. Their rube base will go along with it because the right wing media, they religiously follow, will tell them to. And anyone against it hates America and are easily triggered whenever they hear Drumph’s voice.