Showing posts with label tax increases for the middle class. Show all posts
Showing posts with label tax increases for the middle class. Show all posts

Monday, October 21, 2019

Biden and Warren Can’t Avoid Their Weaknesses Forever

While both remain in the lead in various polls on the Democrat presidential nomination contest, both Joe Biden and Elizabeth Warren leave me with a sense of unease and a continued fear that neither can defeat Trump in a general election.  On Biden's part - if one overlooks his constant gaffes and age - the albatross of his son Hunter hangs over him and he refuses to fully and properly address the issue - something that plays directly into the hands of Trump and Fox News, the GOP state news channel.  On Warren's part, her refusal to admit that her health care plan would raise taxes in a very visible way is an Achilles heel that will not go away.  This, combined with her liberalism in general could likewise play to Trump's advantage. As a piece in New York Magazine notes, neither one of these candidates appears willing to address these liabilities and prepare for an onslaught by Trump should they win the nomination.  Here are article highlights:
If you paid close attention to the Democratic presidential debate this week, you noticed something that Democrats might find disturbing. The two leading candidates — Elizabeth Warren and Joe Biden, probably in that order — both faced tough questions that could damage them in the general election. And neither appears prepared to defend themselves against what is coming.
Begin with Biden, who has a simple problem with no clear solution. His son, Hunter, traded on his father’s name. In Ukraine, Hunter Biden accepted a lucrative position on the board of Burisma, a Ukrainian energy company. Burisma surely believed hiring the vice-president’s son would give it political juice with the United States government. It did not. . . . Yet this does not fully absolve either Joe or Hunter. . . . At minimum, the arrangement marginally spent down the moral capital of the American government and economy by promoting the perception that official favor can be purchased through family members of powerful officials.
Trump, of course, has degraded that moral capital a million times over with his open nepotism and self-dealing. The problem Biden faces is that it is difficult to communicate the nuance of his position. . . . . Biden’s response to this dilemma was to elide it completely. At the debate, Biden simply insisted he and Hunter did nothing wrong while deflecting the inquiry.
For human and understandable reasons, Biden is obviously reluctant to scold his troubled son in public. Yet the fact is that his son’s behavior is an albatross for the father, and all indications suggest that, if Biden wins the nomination, the damage from this relationship will only grow.
Warren, for her part, faced yet another round of criticism over her refusal to acknowledge the financing mechanism of the health-care plan she has endorsed. The political weak point of the Sanders plan is that it would move 157 million Americans off of employer-sponsored insurance and onto Medicare. In theory, this should work out great. (I would be happy to trade my employer insurance for Medicare.) In practice, this requires convincing half the country to swap their current insurance for a government plan, and to convert their health-care premiums (which are nontransparent and remitted directly by their employer, reducing their wages only indirectly) into taxes (which are paid directly). Poll after poll shows both these changes turn the abstractly popular notion of broader coverage upside down.
Warren’s strategy is to dodge both objections. She has, in the past, avoided the question of people losing their employer insurance by saying nobody likes their insurance company. . . . On taxes, she changes the question to total cost and refuses to acknowledge that taxes will go up in the swap.
Warren’s admirers consider this dodge to be clever, but the last debate shows just how politically corrosive it could become. The problem is that Sanders, who wrote the damn bill, openly admits taxes would go up.  . . . The contrast between one Medicare for All supporter honestly admitting how the plan would work, and the other one refusing to admit it, did not make her look good. It gave her opponents an opening to cast her as shady, which they seized.
Pete Buttigieg pointed out that Warren’s response was “a yes or no question that didn’t get a yes or no answer.” Biden said, “it’s important to be straightforward with them,” and Amy Klobuchar added, “at least Bernie’s being honest here.” This is not merely a problem of Warren being associated with an unpopular policy. It is a question that is corroding her reputation for honesty, which is a foundation of her outsider, truth-telling brand.
As with Biden, Warren will find the reality that Trump is orders of magnitude worse to be of little value. Republicans have a party-controlled mass-media apparatus that has trained its rank and file to support liars, but the Democrats do not.
If Biden wants to beat Trump, he needs to put more distance between himself and his son. If Warren wants to beat Trump, she needs to ditch Bernie’s health-care plan and come up with one that doesn’t have political poison pills. The question with both candidates is, what steps are they willing to take to win?

Wednesday, October 04, 2017

Republicans Find Themselves Trapped by Their Own Flimflam


Yesterday I noted that both the Donald Trump "tax reform" plan and the tax cut proposals of GOP gubernatorial candidate Ed Gillespie are based on the long disproved GOP economics that tax cuts for the wealthy will somehow miraculously cause an expansion of economic activity and replace the revenues lost to massive tax cuts.  It did not happen under the Reagan tax reform and more recently it utterly failed in Kansas where extremist governor Sam Brownback and a GOP controlled legislature imposed a GOP dream approach to tax cuts on that state. the results were disastrous and eventually many Republicans joined with Democrats to raise taxes to avoid junk bond status for the state's borrowings and to fund needed services such as roads, public schools and higher education.  Thus the question becomes one of why does the GOP continue to cling to economic and tax policies that have been documented to never work in any way except to put money in the pockets of the super rich and large corporations?  A column in the New York Times gives and explanation.  Here are excerpts:
Last week the Trump administration and its congressional allies working on tax reform achieved something remarkable. They released a tax plan — or, actually, a vague sketch of a plan — that manages both to add trillions to the deficit and to raise taxes on a large fraction of the population. That takes talent.
But like the G.O.P.’s terrible, no good, very bad health plans, this tax debacle was years in the making. On taxes, as with health, leading Republicans have been lying for years. And now the fraud has caught up with the fraudsters.
The road to this tax-cut turkey began in 2010, when Paul Ryan — now speaker of the House — unveiled the first of a series of much-hyped budget plans, all purporting to offer a blueprint for eliminating the U.S. budget deficit.
In fact, they did no such thing. They proposed major tax cuts — primarily benefiting the rich, of course — then simply asserted that no revenue would be lost, because reduced tax rates would be offset by closing loopholes and eliminating deductions. Which loopholes and deductions? Ryan didn’t say.
[T]he Ryan plans also assumed drastic cuts in spending outside Medicare, Medicaid and Social Security. What programs would be cut? The budget office again: “No proposals were specified that would generate that path.”
And what was the Ryan plan if you took out those mysterious revenue raisers and spending cuts? A plan to drastically cut taxes on the rich, savagely cut benefits for the poor and the middle class, and increase the overall deficit.
In other words, it was all a con. As I wrote in a 2010 column titled “The Flimflam Man,” “The Ryan plan is a fraud that makes no useful contribution to the debate over America’s fiscal future.” That judgment looks as valid now as it did then.
And the con went on for years. To this day one sometimes reads articles portraying Ryan as a serious policy wonk, despite abundant evidence of his unseriousness and real questions about his actual command of policy.
But then Republicans regained the White House, meaning that they had to come up with actual tax legislation. And this has put the con under terrible strain.
True, Republicans could just cut taxes on rich people — always their overriding priority — not worry about paying for it, and blow up the deficit. After all, their supposed concern about federal debt was always just a pose, applying only when a Democrat was president. But after all those years of pretending to be deficit hawks, they feel the need to be seen doing something to offset their high-income tax cuts, to close some loophole somewhere.
So they came up with what probably seemed like a clever idea: eliminate the deductibility of state and local taxes. Hey, that would mainly punish people in tax-and-spend blue states, right? Not their problem.
But this turns out to be a much bigger deal than they seemed to realize. (As with health care, they appear to have no idea what they’re doing.) . . . . But eliminating deductions would make many Americans, especially in the upper reaches of the middle class, directly worse off: Almost 60 percent of households between the 80th and 90th percentiles of the income distribution would face tax increases.
And this would happen even though the plan would add several trillion dollars to the deficit. Did I mention that many of those facing tax hikes vote Republican?
In broad outlines, the tax story is a lot like health care. In both cases, Republicans have spent years getting away with big promises backed by lies. Now, with real policy to be made, the lies won’t work anymore. And they can’t handle the truth.