There was such high hopes for Republicans going into 2017. A GOP-controlled House and Senate putting legislation on a Republican President’s desk is exactly what they’ve been asking for since Barack Obama first took office. Voters delivered. All was well in the world. 2017 was going to be the year the GOP finally got stuff done.
I don’t have to tell you the punchline. It’s more like a punch in the gut. I know there are readers who will have valid excuses why Obamacare wasn’t repealed, Planned Parenthood wasn’t defunded, the wall wasn’t funded, and DACA is on its way to becoming law. I also know there are plenty of readers who will point fingers at this faction, that branch, or this person about why we don’t have anything of substance after nearly a year of trying. I’ll nod in agreement with pretty much all of the excuses and finger-pointing because all will likely be valid to some extent. The only one I won’t accept is that the Democrats obstructed. That would be false. They didn’t have to. The GOP obstructed itself just fine.
All of this leads me to the current dilemma. The GOP must pass tax cuts before the end of year. Why? Because the aforementioned utter failures at everything else they’ve attempted have forced them into a position where they might get literally nothing big accomplished in their entire first year with full control. That label is too much for them to want to carry, so they’re doing everything they can to get something they can call tax “reform” on the books. This should terrify us all.
Not only is the plan not what most Republicans would have wanted, it actually does worse by some of the people who wanted it. The effects on the middle class are debatable, but one thing that’s very clear is a huge mistake they have to get fixed before they can pass it. As reported by the Wall Street Journal:
That means a business owner’s next $100 in earnings, under certain circumstances, would require paying more than $100 in additional federal and state taxes.
As lawmakers rush to write the final tax bill over the next week, they already are looking at changes to prevent this from happening. Broadly, House and Senate Republicans are trying to reconcile the bills they passed, looking for ways to pay for eliminating the most contentious proposals. The formal House-Senate conference committee will meet Wednesday, and GOP lawmakers may unveil an agreement by the end of the week.
The possible marginal tax rate of more than 100% results from the combination of tax policies designed to provide benefits to businesses and families but then deny them to the richest people. As income climbs and those breaks phase out, each dollar of income faces regular tax rates and a hidden marginal rate on top of that, in the form of vanishing tax breaks. That structure, if maintained in a final law, would create some of the disincentives to working and to earning business profits that Republicans have long complained about, while opening lucrative avenues for tax avoidance.
In reality, this is should be pretty easy to fix. I’m not going to blow this out of proportion like so many in the media will, but it demonstrates a reality: these tax bills were rushed with the sole purpose of getting something passed in 2017. Had they repealed Obamacare, they would have been much more careful and methodical about putting out a tax cut package that wasn’t loaded with glaring holes and fiscal irresponsibility. Had they gotten the wall funded and started building it in full force, they might have held the tax bill a little longer to make sure they weren’t making huge mistakes with the nation’s economy.
We are riding a wave when the economy is in great shape. By rushing a mistake-ridden tax plan through to the President’s desk, they’re putting all of that at risk. This economy would be strong with very few risks of backsliding if it weren’t for Capitol Hill’s arbitrary deadline prompted by their failure to accomplish anything in 2017. For the sake of their majority, the GOP is willing to put the economy at risk with a sloppy tax plan.
We need tax cuts badly, but I’d rather wait a little longer and get the right tax plan in place instead of rushing it to protect a few politicians fighting for their careers.