With Tax Bill Win, Republicans Rethink Trump
He’s Great At Marketing, He’ll Sign Anything, And His Only Price Is Flattery
And so, at a celebration on the White House lawn, one Republican after another praised the President’s leadership to the skies.
You can watch it here (it goes on and on for almost 40 minutes…):
As we were watching it, we wondered if these folks would stand up to Trump anymore were he to say, fire Robert Mueller?
The top Democrat on the Senate Intelligence Committee appeared to be having a similar thought: in a somewhat unusual move, Senate Intelligence Committee Co-Chair, Mark Warner, took to the Senate floor to express his displeasure with recent efforts to portray Mueller’s investigation into Trump/Russia ties as anything from deliberately biased to an outright coup. Warner seemed particularly distressed that the allegations seem to be part of a coordinated effort, which have of late been repeated by people within the White House and several Republican Members of Congress. And he exhorts Congress to view any move by the President to undermine Mueller’s investigation as a red line that cannot be crossed.
But the Washington Post reports a bill — that at one time was very popular even among Republicans — that would’ve limited Trump’s ability to fire Mueller, has now kind of fallen on the floor and nobody’s bothered to pick it up. At the same time, Politico reports a panel of Republican Representatives led by California’s Devin Nunes has been meeting in secret, for the purpose of compiling and releasing a report slamming the FBI and the Justice Department for their handling of the Trump/Russia investigation.
Back To Taxes
Now that the tax bill has passed, expect Republicans to be on their best behavior for at least a little while. As we mentioned, tax cuts for individuals are front-loaded; they fade out over time. So the biggest cuts most people will see are the first cuts they’ll see. Republicans are counting on that to help them out in the 2018 midterm elections, when every House seat is up for grabs.
The New York Times illustrates this in this graph:
The Times also has a handy calculator for figuring out exactly how much of a break you’ll probably get next year (or not).
Bloomberg late last night reported Trump may not actually sign the tax bill in time for Christmas as he wanted, but will wait until January 3rd. The reason for that? To avoid a provision that would almost immediately kick in and slash Medicare. Which of course is something many Republicans say they want. They just don’t want it to be the first visible impact of the tax bill.
Still, Bloomberg also reports House Leader Paul Ryan is trying to change Trump’s mind on priorities for 2018. Trump’s said he wants an infrastructure bill. Ryan’s pushing for that to be deprioritized and Republicans’ newfound momentum used to attack social welfare programs like Medicaid and food stamps instead.
In Keeping His Big Campaign Promise To Cut Taxes, Trump Breaks Another Big Promise
We remember on the campaign trail, and in debates, almost every time then-candidate Trump brought up tax cuts, he also brought up something called the “carried interest loophole”, as an example of just how “unfair” the tax code had become. And he repeatedly pledged to close it.
That loophole allows hedge fund managers to count a huge portion of their yearly earnings as capital gains, not income. And capital gains are taxed (and will continue to be taxed) at a much lower rate than income. That’s actually a good thing, because it encourages people to invest. But in the case of hedge fund managers, the money they’re taking is off the top of other people’s investments.
So, since this was such a priority for Trump, and so very unjust: it’s out, right? Nope. That loophole remains.
In this clip from CNBC, Trump’s top economic adviser, Gary Cohn, kind of throws up his hands, explaining he tried his best to get it out, but the powers that be in the halls of Congress prevailed.
The House’s chief tax negotiator, Kevin Brady (whom as we’ve said we kind of like because he’s embraced a near-impossible job with gusto and at least is pretty straight up about stuff) had an explanation that while outlandish given the President’s prior level of outrage, sat better with us: “Look, carried interest, we can talk about that for the next hour if you’d like, but for most Americans they could care less about that”.
Something You Might Care About: Your Charitable Contributions Might Not Be Deductible After This Year
We picture this tax bill creating the perfect storm for a young, newly married, upwardly mobile person living in a rental apartment in a high tax state like New York. This person is deeply blue, and donates everything they can to charities opposing many of Trump’s priorities (which ironically, their tax dollars are paying to promote). Now, under the new tax law, this person will only be able to write off $10,000 in state and local tax deductions combined with their spouse (it’s the same total number whether you file as a single or couple), and since they don’t have any mortgage to write off, that’s pretty much it. Which means it’s very likely they will be required to take the new standard deduction of $24,000. Which means charitable giving for them will no longer be deductible.
Think that describes just a very few people? Think again. According to the Wall Street Journal (which we can’t link to because it’s behind a firewall) this will affect about 20-million people.
Is there anything you can do about it? A few things (and some of them have to be done now):
- Make lots of charitable contributions this year.
- Donate this year, then skip a year, so you can bunch your contributions into a big enough amount to push you up to a level where you can deduct them again. Of course, the needs of charities and your desire to help out in emergencies might not fit with the rigid schedule this requires. So, there’s a variation:
- Still skip a year, but instead of donating directly to a charity immediately, earmark a certain amount of money for charity, and then pay it out over a period of time. This sounds kind of hard to do, but since it’s a service that will soon be very much in demand, it’ll soon get really easy.
The Tax Bill “Story Of The Day”
This one from the Washington Post suggests it might not take much to change public sentiment on the tax bill, given how unpopular it is right now. So many people expect to see so little from it that put a few dollars in their pockets, and there’s nowhere to go but up. That’s why we predicted the bill would pass in the first place: nobody doesn’t like free money.
Trump Threatens Global Allies At The U.N.
The word is out: Trump says anyone receiving aid from the U.S. better not vote in favor of a measure criticizing his decision to move the U.S. Embassy in Israel to Jerusalem. Whether anyone will care about that will be seen later today at a hastily scheduled full session of the UN General Assembly.
Earlier this week, the U.N. Security Council rejected a similar measure, sponsored by Egypt. But that’s only because the U.S. vetoed it. Everyone else voted in favor.
Speaking before a Cabinet meeting, Trump praised a Tweet by U.N. Ambassador Nikki Haley saying the U.S. will be watching today’s vote and “taking names”. Trump suggested if countries that receive U.S. aid insist on voting against: “We’ll save a lot. We don’t care.”
You can watch that here:
Some Other Stories We Found Interesting, In Brief…
• Yet another North Korean soldier defects across the DMZ. It’s the second defection in as many months. Unlike last month’s dramatic mad dash for the borderline with North Korean guards in hot pursuit, the latest defector used heavy fog in the area today as his cover. Although shots were fired on both sides, no one was injured. According to South Korea’s Yonhap News Agency: 4 soldiers and 11 civilians have defected to the South this year (the civilians mostly on boats). That compares to 1 soldier and 4 civilians last year.
• Senator Al Franken will not heed calls for him to reverse his resignation and stay. He officially announced his departure date: January 2nd. He’ll be replaced by Minnesota’s current Lieutenant Governor, Democrat Tina Smith.
• That one-vote win by a Democrat in Virginia we told you about yesterday, turned into a tie, after a court accepted this previously rejected ballot in favor of her Republican opponent.
This means the race that will determine control of the state’s lower house could be decided by pulling a name out of a hat. We’re not exaggerating. After which the loser is entitled to another recount…
• Almost as soon as tax cuts passed, AT&T Tweeted that it’s giving all its employees a one-time $1,000 bonus just to show how great the bill just made everything. Trump quickly latched on to the company’s announcement. Of course, the Justice Department is currently holding up AT&T’s proposed purchase of Time Warner. But this move couldn’t possibly have anything to do with that…Right? Business Insider published this funny photo (and true — that is the CEO of AT&T):
- Cliffhangers: Will Democrats show any backbone in year end budget fight? Will Republicans start turning on each other again? See you tomorrow…
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