READ FULL REPORT HERE
In Congress, Rep. Rod Blum (R-IA) is an original cosponsor of a resolution declaring the national debt “a threat to national security.” On her website, Rep. Mimi Walters (R-CA) says, “Our national debt is not only a threat to our financial security it is also a threat to our national security.” On his website, Rep. Erik Paulsen (R-MN) says, “It’s time Washington recognizes the enormous threat our national debt is to our economic prosperity as a nation.”
Yet, last December, all three representatives, along with most of their Republican colleagues, voted for the Trump-GOP tax cuts for the wealthy and big corporations that will add $1.9 trillion to the national debt over the next 10 years, according to the Congressional Budget Office. Then last month they voted for a second round of tax cuts that will add more than $3 trillion to the debt for the first decade after taking effect in 2026. (The voting record for U.S. senators on the Trump-GOP tax law is available here.)
Americans for Tax Fairness has prepared a media briefing book providing more details on these and other tax issues as the midterm elections approach. Referencing authoritative sources and government data, the briefing book fully explains the Trump-GOP tax cut law passed in December and the second round of tax cuts that were voted on in the U.S. House on Sept. 28. We have also prepared a couple of reports on the effects of the tax cuts and budget cuts in individual states:
- Health Care Under Attack: Medicare, Medicaid & ACA Threatened by Trump-GOP Tax Cuts
- Trump-GOP Tax Cuts Round 2: A Bad Deal
The full briefing book is available HERE.
Most of those tax cuts approved by the Republican-controlled Congress benefit the wealthy and corporations, according to the non-partisan Tax Policy Center for the first tax cuts, and the Institute on Taxation and Economic Policy for the second round.
On the other side of the budget ledger, President Trump proposed a budget a couple of months after the tax law passed that would have cut $1.3 trillion from Medicare, Medicaid and the Affordable Care Act to shrink the deficit, according to the Center on Budget and Policy Priorities (CBPP). Shortly after, House Republicans proposed slashing $5 trillion from critical services including:
- $2 trillion from healthcare: Medicare ($537 billion) and Medicaid and the Affordable Care Act ($1.5 trillion).
- Food for families ($157 billion from SNAP, formerly food stamps); veterans’ benefits ($59 billion); transportation and infrastructure ($317 billion).
The president’s top economic advisor, Larry Kudlow, said last month that the administration is likely to wage a campaign for entitlement cuts in 2019 to reduce the deficit the tax cuts have ballooned.
The attack on the Affordable Care Act (ACA) has been particularly pernicious. The Trump-GOP tax law guts an ACA requirement for individuals to buy health coverage if they can afford it, with the government subsidizing low-income families. The change saves the government $314 billion, according to the Joint Tax Committee, money being used to partially pay for tax cuts mostly benefitting the wealthy and big corporations, including very profitable drug companies and health insurers. By repealing this critical part of the ACA, the tax law will cause:
- 8 million Americans to lose health care coverage per the Brookings Institution.
- ACA insurance premiums to spike by 10%, on average, most years for the next decade, per the Congressional Budget Office.
- Even steeper premium increases for older adults – in effect, an “age tax.” The average 64-year-old could face a $1,500 premium hike, according to the AARP.
While pushing for his tax cuts, President Trump promised that corporations would use their 40% tax cut to give working families a $4,000 raise. Tax rates were slashed from 35% to 21% on domestic profits and to half that rate on offshore profits, giving corporations even more incentives to shift jobs and production offshore than they had before.
But just 4.4% of America’s, 155 million workers, have received a one-time bonus or pay raise from the tax cuts, according to a comprehensive database maintained by Americans for Tax Fairness. Moreover, last year’s tax cuts have not improved wages. Real (inflation adjusted) wages have been flat for all employees from August 2017 to August 2018, per the latest Bureau of Labor Statistics data.
Instead, corporations are mostly using their tax cuts for stock buybacks, which are expected to reach $1 trillion this year alone and largely benefit wealthy shareholders and CEOs. Since the tax law passed, corporations have announced 106 times more in stock buybacks than they are giving in worker bonuses or raises connected to the tax cuts—$750 billion in buybacks vs. $7 billion in wage hikes. The full list of announced stock buybacks so far can be found HERE.
To determine how incumbents voted on the Tax Cuts and Jobs Act, and on the related repeal of the Affordable Care Act, you can find their voting records here:
Protecting Family and Small Business Tax Cuts Act of 2018 (Tax Cuts 2.0)
U.S. House of Representatives, Sept. 28, 2018
READ FULL REPORT HERE