As April 15th looms closer, those tax cuts the Republicans keep pushing sure look tempting. Alas, as top economist Robert Reich reminds us, if something looks too good to be true then it probably is.
As the UC Berkeley professor and former labor secretary to Bill Clinton explained in his blog post on Monday, Donald Trump’s and Ted Cruz’s proposed tax plans make President Ronald Reagan’s tinkle-down “voodoo economics” look like the height of common sense.
The tax cuts for the rich proposed by the two leading Republican candidates for the presidency – Donald Trump and Ted Cruz – are larger, as a proportion of the government budget and the total economy, than any tax cuts ever before proposed in history.
Robert Reich then reminds us not to get taken in by Donald Trump’s and Ted Cruz’s outsider schtick:
Trump and Cruz pretend to be opposed to the Republican establishment, but when it comes to taxes they’re seeking exactly what that Republican establishment wants.
Donald Trump may sound like he wants to soak the rich, but his proposed tax plan would result in a YOOOGE average tax cut of over $1.3 million per year for “really rich” folks like Donald Trump. Robert Reich takes care to add that — under these tax cuts — we middle-class peons would only average $2,700 in tax savings per year for our households. Is that worth destroying our roads and schools for?
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Meanwhile, Ted Cruz wants to replace our progressive income tax with a 10 percent flat tax for all income brackets and sources — including investment returns and other passive income. This would punish people who actually work for their living. These Republican tax plans would also cancel all estate and gift taxes so our nation’s one percent can pass more wealth down to their heirs.
This sort of system would burden lower-income workers who spend almost everything they earn and have few if any investments.
Republicans love bragging about being more fiscally responsible than the Democrats, but their tax plans would cripple our federal government by cutting revenues by up to $12 trillion over the next 10 years. And guess what? Ted Cruz and Donald Trump still want to beef up our military. As Robert Reich explains, both GOP presidential candidates’ tax plans would prove disastrous.
Bottom line: If either of these men is elected president, we could see the largest redistribution in American history from the poor and middle-class of America to the rich. This is class warfare with a vengeance.
Even those doughty old toffs across the pond at The Economistcalls the GOP’s tax proposals “exorbitant” and “jaw-droppingly expensive.”
While Republicans often claim that — at 39 percent — US businesses pay one of the highest corporate tax rates in the world, it never actually works out that way. Thanks to our crazy quilt of exemptions and loopholes, many of our most profitable companies (and the CEOs who run them) barely pay any taxes at all.