10 Tips to Keep the Eye On Ball–Flynn is a Blip Compared to Tax Scam

In Current Events, Economy, Politics by Jonathan Tasini0 Comments

I’ll spend today reminding people that the Tax Scam must be the focus. This is what will matter to millions of Americans for a generation and more to come, not the blip about Flynn (who will end up being barely a footnote in history).

So…10 handy tips/reminders:

1. Underscore the madness of the bill process—Republicans are trying to write a trillion-dollar plus bill **on the fly**. I mean, even as I wrote that, it seems beyond absurd. And all in the service of ramming through a bill that will do huge harm to the people.

2. As an example of the depravity of the bill: the 1.4 trillion tax cuts for the wealthy could be reduced by $50 billion—a rounding error—and fund for about four years the Child’s Health Insurance Program (CHIP) which has expired.

3. It is absolutely a reality that the “deficit hawks”, who will vote for this debt-creating bill, will be back within a year or so to demand CUTS to Medicare, Social Security, Medicaid, education and every other social program. You can lay a winning bet in Vegas on this. However, this is a feature not a bug—this part of the dismantling of the country’s social support system.

4. The massive give-away to corporate profits salted away. The Institute for Taxation and Economic Policy: “The biggest giveaway on the international side of the Senate tax plan is its extra low rate on accumulated “offshore” earnings. Under the plan, companies would only have to pay a 10 percent rate on offshore earnings held as cash and a 5 percent rate on all other earnings. According to the Joint Committee on Taxation (JCT), this means that companies would pay just $190 billion in taxes on their $2.6 trillion in accumulated offshore earnings. This translates into a $562 billion windfall for multinational corporations since they owe an estimated $752 billion in taxes on these earnings. The Senate’s repatriation tax break would cost more than $100 billion more than the House proposal, which would tax offshore earnings held in cash at 14 percent and all other offshore earnings at 7 percent.”

5. Every time you hear the words “35 percent corporate tax rate”, reply: it’s a myth bigger than the Loch Ness monster. Simply put: the effective tax rate is around 14 percent on average and most Fortune 500 companies pay for below any effective tax rates and some extremely profitable pay ZERO. See here.

6. Which means…that U.S. based corporations are not at a competitive disadvantage compared to the rest of the OECD countries. That’s a big lie. The reason corporations go abroad is to seek LOWER WAGES.

7. The rich do not run away from higher tax states. That’s a myth. See this here.

8. No one is talking about the big hole still to be addressed by eliminating the estate tax, which the House bill calls for. I analyzed that here yesterday.

9. Per the ITEP folks: “In 2019 the richest one percent of taxpayers would receive 60 percent of the pass-through tax breaks and 44 percent of the corporate tax breaks.” And: “Even when taking into account all the tax changes (not just changes to the personal income tax), the middle-fifth of taxpayers on the income ladder would face an average tax hike of $60 in 2027.”

10. This is entirely about WAGES and what people earn (a point I made in this CNN.com piece last month). Whether we like it or not, 70 percent of the economy is based on consumer spending, wages are far too low to sustain economic expansion and, if economic expansion is the goal, raising wages can be done by broad unionization (which Republicans adamantly oppose) and raising the federal minimum wage as fast as possible to at least $15-per-hour (which Republicans also adamantly oppose). Essentially, the Republican tax cut plan is a fraud, and entirely ignorant of what would bring economic expansion.

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