The negotiations over the Trump tax overhaul have moved from tragedy to farce. You could let monkeys bang on typewriters for several millennia and not come up with an idea as profoundly stupid as what Senate Republicans added Tuesday to appease one of their own members.
Before we get to that, let’s be clear that this astonishingly dumb notion is being scooped on top of a bill that is already economically illiterate. It’s painstakingly designed to punish people making under $75,000 a year and those who happen to live in states that didn’t vote for Donald Trump. It benefits wealthy investors and wealthy people who incorporate; basically being wealthy or being a member of the Trump family is the prerequisite. CEOs (“the most excited group out there,” according to the bill’s architect, Gary Cohn) have given away the game in earnings calls by admitting that the corporate tax cuts, easily the largest chunk of the bill, would flow out to shareholders in dividends and stock buybacks, rather than used to create jobs or raise wages. The bill is a gift to capital owners at workers’ expense.
But Senator Bob Corker and some of his colleagues, like Oklahoma’s James Lankford, are showing some residual concern about deficits. In response, GOP leaders initially limited the total cost of the tax cuts to $1.5 trillion over 10 years, and under Senate rules the bill could not raise the deficit at all after that. Republican leaders reached that number with a variety of gimmicks, like having the individual tax cuts expire after 2025 (while the corporate bounty lives on), and by assuming absurdly high economic gains from the cuts.