Tax Cuts: The Long Game

There’s something particularly insidious about this tax cut bill: a long game that makes it a win-win for Republican leadership no matter how it plays out.

We’re debating amongst ourselves whether this is completely deliberate, or merely fortuitous. But either way, it’s now set in motion…

Trump and Republicans say the public is clamoring for tax cuts. Trump: “they want it, they need it.” Even though polls consistently find it isn’t really at the top of the list of items of importance for most Americans.

But Republicans know their agenda stands to benefit from passing this tax cut package whether people really want it or not. If it ends up being a success, and corporations do the right thing for once and spend their windfall creating jobs, and the economy booms beyond the wildest expectations, they’ll be heroes. If it ends up being an astronomical failure it will leave the nation without much of a choice but to start chopping away at Social Security and Medicare. (By then Congressional Republicans hope they will also have “taken care” of Medicaid as part of an Obamacare repeal). Paul Ryan has been itching to do this for years, and he’s made no secret of it. The problem: right now doing so would be wildly unpopular, without obvious economic justification. But pass the tax cuts and wait, and those justifications may grow like weeds through cracks in a decaying sidewalk.

That’s because about 75% of the federal budget goes toward just three broad categories: 24% for the military and veterans benefits, 24% for Social Security, 26% for Medicare, Medicaid and health subsidies.

Here’s a pie chart that slices it up with more specificity:

So if the unprecedented, deep tax cuts for corporations and wealthy individuals end up causing an equally unprecedented budget crisis, there will be no way out really but to cut Social Security and Medicare (the military will never ever be cut), and it suddenly becomes possible because it suddenly becomes essential. Hence, the sad win-win for the big picture agenda for Ryan and his cronies, whether their tax plan succeeds or not.

(This story originally appeared in “The Chaos Report” Newsletter. Subscribe at https://thechaosreport.com/subscribe/?scr=Medium)