New Tax Cut Proposal to be Considered Thursday is More of the Same: Favors the Wealthy, Balloons the Deficit, Threatens Medicare/Medicaid/Social Security
WASHINGTON, D.C. – A coalition of 137 prominent national organizations have come together with 639 state groups to oppose a second round of tax cuts proposed by President Trump and House Republicans that will, like the previous cuts, largely benefit the wealthy and jeopardize funding for Social Security, Medicare, Medicaid and education, and cost an estimated $2.8 trillion over 10 years.
Joining Americans for Tax Fairness in signing the letter to Congress are such diverse groups as the AFL-CIO, Center for American Progress, Children’s Defense Fund, Faith in Public Life, MoveOn.org, National Women’s Law Center, Our Revolution, Patriotic Millionaires, The Leadership Conference on Civil and Human Rights and many more (see complete list HERE).
“The richest Americans do not need another massive tax cut,” the letter states. “[T]hey and America’s corporations need to start paying their fair share, so we have the resources needed to protect Social Security, Medicare and Medicaid and to invest in education, infrastructure and many more services working families and communities need to thrive.”
The House Ways & Means Committee will meet Thursday to consider new tax cut legislation that is the subject of the letter. A full House vote on the measure is expected later this month.
The groups signing the letter in opposition say the first round of tax cuts, the Tax Cuts and Jobs Act enacted last December, bestows most of its benefits on the wealthy and large corporations and will add $1.9 trillion to the national debt, according to the non-partisan Congressional Budget Office. The letter says that the enormous price tag for the tax cuts is being used as an excuse for conservatives in Congress to make deep cuts to vital public services that tens of thousands of people rely on, including seniors, children, women and people with disabilities.
“Extending or expanding the law’s existing provisions will likewise primarily enrich the already wealthy while further threatening essential services and investments,” the letter says.
On its website, Americans for Tax Fairness presents data showing that the first round of tax cuts has failed to fulfil the promises made by its proponents to raise wages—especially for working families—and increase investments. In fact, just 4.4% of workers are getting any one-time bonuses or wage increases as a result of the Trump-GOP tax cuts. Real (inflation adjusted) wages decreased by 0.2% for all employees from July 2017 to July 2018, and few if any have received the $4,000 pay increase promised by President Trump, contrary to the “trickle down” effect that proponents claimed would happen.
Meanwhile, 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 100 times more in stock buybacks than they are giving in worker bonuses or raises connected to the tax cuts—$712 billion in buybacks vs. $7 billion in wage hikes. In addition, corporate profits surged 8.2% in the first quarter of this year after passage of the tax cuts while tax revenue to the U.S. Treasury has fallen by 44% from a year ago due to the tax cuts.
“America cannot afford the Trump-GOP tax cuts benefiting the rich and corporations, and we sure cannot afford a Round 2 that puts the interests of the wealthy over everyone else,” the letter states. “We urge you to oppose the new House bill and instead support legislation to ensure that the wealthy and large profitable corporations pay their fair share so that we have the revenue needed to invest in our families and communities to strengthen public education, fix infrastructure, make healthcare more affordable, assist families in need of affordable childcare, housing, nutrition and other basics, and provide a secure retirement with dignity.”
For a copy of the letter and a complete list of the organizations that have signed, go HERE.