Economy Taxes

Jeb Bush Calls for Bigger Tax Cuts Than George W. Bush

Written by SK Ashby

As promised, Jeb Bush has unveiled his tax "reform" proposal and while I was inclined to refer to it as the "Bush Tax Cuts 2.0," the truth is Jeb's tax cuts would be far more crippling than his brother's tax cuts.

Jeb's proposal goes much further than other proposals recently considered by congressional Republicans who mistakenly believed they could pass a bipartisan reform bill in this Congress.

To call Jeb's plan a "reform" plan would be far too generous unless your idea of reform is obliterating federal revenue.

He takes the income tax rate down from about 40 percent to 28 percent (Republican Dave Camp’s plan went to 35 percent). He takes the corporate rate from 35 percent to 20 percent (Camp went to 25 percent), and allows for full expensing (immediate and full deduction) of capital investments. He goes to a territorial system so foreign profits would no longer be taxed when repatriated back here. He eliminates the estate tax and the alternative minimum tax. There’s a bump down in the rate for unearned income (cap gains, dividends).

Jeb's plan includes some meager measures that would raise revenue, such as closing the carried interest loophole, but these measures would not collectively make up for the massive, across-the-board cuts Jeb calls for.

Like every other Republican proposal dating back as far as I can remember, Jeb's plan relies on so-called dynamic scoring. Dynamic scoring, or "magic asterisks," if you prefer, is a prediction that economic growth resulting from tax cuts will make up for the loss of revenue.

Jeb Bush is suppose to be the serious candidate but he's running on the same economic fairy tale Republicans have run on for many years. This plan and others floated recently by congressional Republicans are not significantly different than Paul Ryan's Path to Poverty and, not-coincidentally, Ryan is the current chairman of the House Ways and Means Committee (David Camp was the former chairman).

This is a stark contrast between Jeb Bush and Donald Trump. Trump, for his part, has called for raising taxes on the rich and yet he widens his lead over Bush every week.