On this Tax Day, let’s pause for a moment to appreciate how difficult it is to craft a massive tax cut that the American public doesn’t like. Republicans recently managed to do just that, passing a tax “reform” scheme that finances over $1 trillion in cuts skewed overwhelmingly toward corporations and the wealthy through deficit spending and is projected to cause 3 million Americans to lose their health coverage as a result.
The tax bill did gain in popularity after it was passed in December, mostly because Republican partisans were happy that their party, which controls all of Washington, finally managed to pass a significant piece of legislation. But as New York magazine’s Eric Levitz pointed out, several polls have found that it then became less popular once it went into effect in January. Three recent polls have found that the cuts remain under water in terms of public opinion by a margin of 8-9 percent.
That shouldn’t come as much of a surprise; the average $4,000-per-household raise in after-tax income with which Republicans sold the tax bill never materialized. An analysis by the Tax Policy Center found that an average household earning between $49,000 and $86,000 will see a cut of around $930 per year, almost half of which will be wiped out by rising gas prices (not all of which can be attributed to Trump or his party, but, as USA Today notes, “fears of political instability in the Middle East, including the prospect of U.S. military strikes in Syria, and trade tensions with China” are a big part of the story). Fewer than one in three respondents to a recent survey by CNBC said they’d noticed any bump at all in their pay.
But it’s the brazenness with which the Republican Party abandoned any last remaining pretense of caring about deficits or federal spending that may come back to haunt them, and mark a shift in the political landscape around taxes and spending. It goes further than the $1.9 trillion in additional deficits, including higher payments on the national debt, that the Congressional Budget Office (CBO) projects will result from the tax bill over the next 10 years. When the nonpartisan number crunchers evaluated the fiscal impact of all of the legislation passed since mid-2017, including new spending, their analysis found that the GOP will add $2.6 trillion to the deficit over that period. What’s more, as Catherine Rampell noted in The Washington Post, that assumes that the economy will continue growing apace, and that the “temporary” individual tax cuts will expire according to the written law. But recent history suggests otherwise—most of George W. Bush’s budget-busting cuts were made permanent under Obama. In CBO’s worst-case scenario, “deficits would be larger by an average of a full percentage point of GDP, rising by a total of $2.6 trillion to yield a cumulative deficit of nearly $15 trillion” over the next 10 years.