I can think of two reasons to like it and three reasons to … not dislike it, exactly, but to be wary, shall we say.
It reminds me of the criminal justice reform bill he helped get passed inasmuch as neither idea is at the core of Trumpism but each has potential populist appeal. Both bills are electoral ploys for him more so than they are cherished MAGA policy goals. I don’t mean that as a critique, though. Every politician’s entitled to a little pandering on his agenda.
We could do worse than this:
Larry Kudlow, director of the White House National Economic Council, is spearheading the effort behind Trump’s second tax cut package and is widely seen as a leading proponent of the new 15 percent rate. It is unclear if Trump has approved the idea, but the president has pushed aides to develop a simple tax message for 2020 focused on middle class tax relief.
Currently, there are seven tax brackets that increase up the income ladder — 10 percent; 12 percent; 22 percent; 24 percent; 32 percent; 35 percent; and 37 percent. The Republican tax law of 2017 did not reduce the number of federal income tax brackets, but doing so would likely be a part of the “tax cut 2.0” package. The existing 22 percent rate kicks in for single Americans earning more than about $39,000, while the 32 percent rate applies to single Americans earning more than $160,000.
While details remain in flux, Moore said one possible plan would retain the existing tax rates at 10 percent and 12 percent for the bottom two tax rates, as well as the existing top three tax rates. The plan would likely aim to bring down to 15 percent the rates for those who earn between $30,000 and $100,000, Moore said. Doing so would give tax relief to the middle class and the rich, since the rich also pay marginal taxes on the lower rates.
What’s to like about that? Well … it’s a tax cut. For the middle class. Need I elaborate?
Not on a right-wing blog, I hope. More money in the middle class’s pocket means rising standards of living and a growing economy.
It’s also a little insurance against the Democratic field, in particular Elizabeth Warren and Bernie Sanders. Polls show Biden is the toughest 2020 match-up for Trump but in some ways that’s a comfortable race for POTUS. He’d be facing an Obama cabinet member, an establishment dinosaur, a squish from the center of the party, and someone against whom he has a ready-made “corruption” narrative ready to go. In certain ways it’d be a rerun of the 2016 election, the populist Trump versus the Swamp Creature. (And in certain ways not. Biden is more likable than Clinton, should play better with the white working class, and has much less scandal baggage.) Put him up against Warren or Sanders instead and all of that is wiped away. Then it becomes a “Trump versus Socialism” election. The risk there, though, is that Warren and Sanders will each have their own populist narratives to counter Trump’s, and as tends to happen with Democrats, they can outbid him on how much they’re willing to give away. Warren’s promising “free” universal health care and mostly “free” college tuition, among other things, and she’s claiming — ludicrously — that she won’t need to hike taxes on the middle class to do it. Trump’s going to need to counter. Solution: A middle-class tax cut. Cut the working man’s taxes and let him decide for himself whether the $50 trillion Warren health care boondoggle or Trump’s tax relief are more likely to benefit him.
Those are the pros. There are cons.
For starters, a new tax cut is a tired idea from a party that seems intellectually exhausted. The only major legislative achievement of the GOP’s two years in total control of government was … another tax cut. Trump has done some, er, innovative things using executive power, most notably tariff-palooza, but as far as lasting accomplishments to come out of Congress go, the only thing Republicans seem capable of anymore is slashing taxes. I don’t know how swing voters will feel about the same old song when Warren’s promising a glorious revolution in how American life, from education to health care to labor, might function.
A tax cut geared specifically at the middle class also inadvertently boosts a core Democratic criticism of the 2017 tax cut, namely that it mostly benefited the rich. You can anticipate Warren’s attack on this new proposal before she makes it: Why didn’t Trump focus on middle-class tax relief when he controlled Congress? Why did this alleged Republican populist only think of lifting a finger to help hard-working Americans a year out from a national election, when Democrats are proposing all sorts of radical schemes to redistribute money down the income ladder? Given the GOP’s obedience to him, he could have laid down the law to Mitch McConnell and Paul Ryan by demanding a more progressive tax-cut scheme when he had the chance. Now suddenly he’s interested in it as a pure election gimmick, with no reason to believe he’ll follow through if elected. At a minimum, he should be forced to state what concessions he’d be willing to make to Pelosi in order to get this passed given the likelihood that he’ll be dealing with a Democratic House again in his second term.
Finally, we all know what happens when taxes are cut but spending is not. We’re living it right now, every day, the numbers growing more impossibly gruesome by the moment, with Trump and his “small government” colleagues in Congress showing not the tiniest concern about it. If the GOP is going to even pretend to care about “fiscal responsibility” next year — and maybe it won’t, given the state of the party now — any middle-class tax cut needs to be paired with cuts. Specify up front what’s getting slashed to offset the loss of middle-class revenue. No more nonsense about the tax cuts “paying for themselves” in the form of growth. Does Trump really want to push tax cuts in front of voters if he also has to explain which goodies from Uncle Sam will also need to eliminate in the name of making the books balance (or, rather, making the books not go even further wildly out of whack than they already are)?
Exit question: If he’s looking to pander effectively to 2020 voters, how about focusing on those suburbanites he seems to have so much trouble with nowadays? A middle-class cut would help but he could also look at lifting the annual cap on 401ks or 529 plans. Or, better yet, focus on expanding the child tax credit. Suburbanites often become suburbanites because they have kids; show them that you want to make it easier to raise a family via special tax relief aimed squarely at them. Doing that instead of an across-the-board middle-class tax cut would also have the vindictive benefit for Trump of screwing his enemies, those childless urbanites who tend to vote Democratic. All he needs to do is figure out how to pay for the larger credit. Piece of cake.
