Friday, December 1, 2017

Republicans Inch Closer to a Tax Deal

As a conservative and a former Republican, tax reform and tax cuts are close to my heart, and the sight of the GOP "Gang Who Couldn't Shoot Straight" inching their way toward a bill that cuts taxes and (modestly) reforms them is a good thing. Let's be honest--if a GOP Congress couldn't get a tax cut done, it might as well fold. Reforming the tax code is harder than cutting taxes, but there is a little of that here too.

There is a lot to like in this bill. Lowering corporate rates is a pro-growth initiative. Eliminating the deduction for state and local taxes appeals to me as a limited government man (although it will likely hurt my bottom line); perhaps because the true costs of lavish government spending in blue states will now be known to the taxpayer, there will be some downward pressure on them.

Limiting/restricting the mortgage interest deduction also strikes me as common sense. I am however, not sure there has been sufficient attention paid to what the double whammy of eliminating property tax deductions and limiting the mortgage deduction will have on the real estate market. The financial crisis of 2008 was mainly a crisis caused in the housing market--and one wonders what will happen to a market like the one in California as a result of these changes.

What is this tax reform NOT? It is not aimed in any way, shape, or form at making the lives of the famous "Trump Voters" better. Are we really to believe that the temper tantrum voters of PA/OH/MI/WI peering at the news over their Millers are rising in praise of the corporate tax cut from 35% to 20%? When those with a few children realize that the doubling of the standard deduction is essentially zeroed out by the elimination of personal exemptions--and their taxes rise as a result--who will they then turn to?

Globalist cuck Marco Rubio tried to address the pro-business/anti-family nature of the bill with an amendment that reorders priorities in this bill be cutting the corporate tax rate to 22% (from 35% instead of down to 20%), and then doubling the child credit to $2000.  "Rubio's amendment(s) makes the credit more defensibly refundable by tying it to the payroll tax, removing the marriage penalty in the credit's phaseout, and indexing the credit to inflation".   The previous quote comes from a Forbes hit piece on the amendment that looks like it was written by the two rich brothers in "Trading Places". The President is apparently fixated on the 20% number and is unwilling to budge, creating a situation in which an already gigantic decrease in corporate taxes rises as a priority over a REAL tax cut for middle class working families.

Finally--the GOP has been in power in both political branches for nearly a year--and their signature achievement if it comes to pass--will be to add $1.5T to the national debt. Where is ANY talk of cutting spending in this White House and this Congress?  No one should be surprised that a guy who milked the credit markets through four bankruptcies as a private citizen is unconcerned with running up the credit card bill in office.

Bottom line here: these initiatives are better than nothing, and good in some places. But for this bill to be in any way worthy of the disruption, chaos, and embarrassment of the election of Donald Trump as President, it should have at the very least addressed the dinner table issues of the people whose uncontrolled anger put him in office. It does not do this.

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