Democratic Rhetoric on GOP Tax Law Is Just Silly

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An acquaintance who owns a large California business likes to talk about the negligible impact of the tax code on his personal life. As he puts it, well-off folks can afford the homes, cars and vacations they enjoy. Their lifestyle is static. When the government taxes them at a higher rate, that simply means they have less money to expand their business. It won't force them to subsist on macaroni and cheese, sell the Tesla or feel any personal discomfort.

That's a key point to consider when you listen to the rhetoric from Democratic leaders about the supposed evils of the recently passed Republican tax plan. The left wants to punish the rich, but defending higher taxes mainly punishes everyone else.

House Minority Leader Nancy Pelosi referred to the bill as a "rip-off, this plundering, this pillaging of the middle class." Sen. Bernie Sanders (I-Vt.), whose leftist rhetoric almost gained him the Democratic presidential nomination, said: "Today marks a great victory for the Koch brothers and other billionaire Republican campaign contributors who will see huge tax breaks for themselves while driving up the deficit by almost $1.5 trillion."

Sanders' words were particularly foul by suggesting that these donors—people who fund myriad libertarian causes, including some such as criminal-justice reform that should appeal to liberals—are trying to stuff more dollars in their pockets. But Sanders probably is right that the tax plan will add to the nation's appalling deficit. That's an apparent flaw in a Republican tax bill that lowers tax rates in an attempt to jump-start economic growth, but Democrats (through the Byrd Rule) have made it virtually impossible to cut spending. Better half a loaf than nothing.

And how can Democrats seriously complain about deficit spending? Their political platform is all about spending more government money. Massachusetts Sen. Elizabeth Warren even compared the bill to robbery, yet all such spending is taken from current taxpayers—or from future ones in the form of the growing national debt. That said, many observers—even conservative ones—don't believe that the bill's myriad breaks will pay for themselves.

"Most Republicans say that the tax cut will generate so much extra growth that it will increase revenues," opined the editors of the conservative National Review. "No economic model of the tax cut, not even any of the models produced by conservative economists, backs this claim." It lets Republicans, however, "offer tax cuts to various constituencies without having to impose any restraint on spending."

The last sentence sums up my problem with every tax bill I've written about in my adult life. Despite Republican rhetoric about cutting government, no one ever cuts government spending. Indeed, the Trump administration wants to invest in military and national-security programs, build a border wall (that Mexico is definitely not going to pay for), and even push NASA to send astronauts back to the moon. Those things aren't free, either.

Nevertheless, many of us object to the Democratic concept that cutting taxes for individuals and businesses is the same as "spending" more money, as writer David French pointed out. That's only true if the government has a claim to our entire paycheck.

A lot of attention has focused on the political ramifications of the bill. Indeed, the plan was the first major legislative victory for the president—one he desperately needed. But that's neither here nor there in terms of policy. (As an aside, if Donald Trump spent more time on such substantive matters and less time tweeting nonsense, perhaps Republicans would have a better chance of passing other substantive measures.)

What matters is whether the bill's provisions are good ones. Mostly they are. It does some constructive things. For instance, most Americans—not just the wealthy, despite Democratic claims to the contrary—will have lower tax rates. Most parents will benefit from a doubled child tax credit. It repeals the individual mandate penalty for health care, which was a noxious portion of Obamacare. It lowers the corporate tax rate to 21 percent and reduces myriad tax penalties for businesses. It also doubles the exemption for the hated death tax.

Unfortunately for those of us living in high-tax blue states, we'll get hit with some higher taxes given that the plan caps the deduction for state taxes and reduces the mortgage interest deduction on large home loans. But why should the rest of the country subsidize our state's foolishly high income taxes or our sky-high home prices, which are driven by liberal slow-growth policies? If Sacramento Democrats were seriously concerned about this problem, they could, you know, give Californians a tax break to ease the pain.

At least the bill pushes in a lower-tax direction and rebukes the Democratic class-war nonsense. Who really cares how rich people spend their own money? We should all be more concerned about encouraging them to invest in their businesses.

Steven Greenhut was the Union-Tribune's California columnist. He is western region director for the R Street Institute. He is based in Sacramento.

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  • Michael Hihn|12.29.17 @ 2:45AM|#

    Speaking of silly ...

    That simply means they have less money to expand their business. It won't force them to subsist on macaroni and cheese, sell the Tesla or feel any personal discomfort.

    Smartass sarcasm can be unwise … after LITERALLY saying jobs could not be created ... then switching to the opposite side on taxing the rich!!

    The left wants to punish the rich, but defending higher taxes mainly punishes everyone else.

    That's true. But all the damn whining about "the left" here -- many times per day -- is kinda dumb on a web site that BELEEBS independent voters are their future ... but NEVER a peep about "the right" (as a group) … which is GUARANTEED to drive away those same Independents Nick and Matt wrote a book about. Independents can smell tribal bigotry at 1000 yards. It's WHY they're neither tribe.

    And the libertarian establishment has NO tax plan at all.

    And how can Democrats seriously complain about deficit spending?

    Whataboutism (yawn)

    ...David French pointed out. That's only true if the government has a claim to our entire paycheck.

    Only true for the wackos who chant, mindlessly, "all taxation is theft." And a tax cut IS like spending ... for YOUR reason ... the goddamn deficit, back when you cared about it, 48 seconds earlier.

    Cont'd

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  • Michael Hihn|12.29.17 @ 2:46AM|#

    Part 2

    But why should the rest of the country subsidize our state's foolishly high income taxes or our sky-high home prices,

    Double taxation is only bad when "the left" does it. And bashing California is as much fun as .. Benghazi.

    P.S. The tax law will cause a large increase in state tax revenues, as reported at …. reason.com!

    At least the bill pushes in a lower-tax direction

    That's the same excuse used by the GOP, for the deficits you cared about, 94 seconds earlier.

    and rebukes the Democratic class-war nonsense

    THAT is the silliest of all It does the exact opposite. The right is too damn stupid to deal with BULLSHIT tax cuts for the rich. This one is for real.

    It was libertarians who began saying Left – Right = Zero

    Now it's libertarians who need to hear it.

    Time is running out ...

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