Republican Tax Plans: A Huge Mistake

I’m having a recurring nightmare. And it’s not that I forgot to file my taxes. It’s that, somehow, someone is making me look back almost fondly on the tax policies from the George W. Bush administration. Shudder.

Remember the Bush years? Tax breaks largely benefited the wealthy and helped turn a budget surplus into a deficit.

Don’t get me wrong — even in my darkest moments, I don’t want to go back there. But reading the tax plans from the present-day GOP’s presidential candidates does force you to acknowledge that there are Republicans who make George W. Bush look downright fiscally responsible.

Without getting into all the added goodies for the wealthy of eliminating the estate tax or slashing capital gains rates, we can see taxes paid by those at the top will drop dramatically under the Republican plans.

Trump’s plan, for example, cuts taxes for the top income bracket (that’s where he is, BTW) by about 37% by reducing the top bracket from 39.6% to 25%. Under a President Cruz (yikes), the 1% would have their taxes slashed by a whopping 75% by reducing the tax rate to 10%. And the top tax bracket gets a big break in Kasich’s plan, as well, cutting their taxes by 30%, with 28% as the top rate.

But what if you’re not super wealthy? If you know how much a banana costs, you wouldn’t see much savings in your checking account thanks to the GOP. A senior fellow at the Brookings Institute summed up Kasich’s plan by saying, “there’s not much going to the middle class,” but they could have said that about any of the Republican plans. Compared to the gigantic tax cuts that the rich are getting in Cruz and Trump’s plans, the middle class would see comparatively meager tax cuts. For instance, Vox found that under Cruz’s tax plan someone making about $64,000 would see their taxes cut by $1,783. Great. But someone making four times as much would see a disproportionately large cut of $16,129 (not $7,132 which is $1,783 x 4). And the top 1 %— those who make about 36 times that of our first person — would get a nice $407,708 cut (yet $1,783 x 36 is $64,188).

To put it another way, the person making about $64,000 would see their after-tax income increase by 3.2%, meanwhile, the person making four times as much would see an increase of 8.2%, and your friend who owns a private jet would see at least a 26% increase in their after-tax income.

Now, all of these guys want to tell you that the national debt is ruining the future of America, will make our children less free, and that we must be fiscally responsible! Maybe they blocked out the fact that their tax cut proposals cost trillions (yep — with a ‘t’) of dollars and they haven’t provided a plan to pay for them.

Those Bush tax cuts that helped us move from a surplus to deficits while handing cash over to the wealthy cost $1.32 trillion — or $1.82 trillion in today’s dollars. The price tag on Trump’s plan is $9.5 trillion, Cruz’s plan would cost $8.5 trillion, and Kasich’s plan to somehow balance the budget while increasing defense spending and piling on these massive tax cuts for the rich is so unrealistic that Al Hunt called it “voodoo economics.” All three of them are trying to win voters over with the illusion of big economic benefits that they just can’t deliver.

While Republicans like to pretend that tax cuts actually increase government revenue, those of us who understand that 2+2=4, can see that they are going to balloon the deficit and cut programs (and entire departments) from the government. To give a sense of what those cuts would look like, I’ll sample from Ezra Klein at Vox who has valiantly tried to put these numbers into perspective:

“So to pay for Ted Cruz’s tax cut, you’ve got to get to something like $8.6 trillion. If Ted Cruz eliminated Medicaid and the Children’s Health Insurance Program in their entirety, he wouldn’t get there. He’d have to then add all federal education spending, so cutting all Pell Grants and all K-12 subsidies, HeadStart, everything of that nature. All federal spending on Justice functions, so no more FBI, no more Drug Enforcement Administration, federal court system goes away, the federal attorneys go away. All international spending, so you close all of our foreign embassies, you zero out all of our aid to Israel, you get all of that. And he’s still not done. You gotta take out all federal transportation spending, so everything we’re putting into highways, everything we’re putting into getting around, and all spending on veterans. And Donald Trump would then need another trillion dollars on top of that of cuts. And that’s to say nothing of both men then wanting to spend even more money on the military. These are really wildly implausible tax plans, and maybe on some level they’re not that implausible if you just want to come out and say, ‘Well I’m just going to get rid of Social Security.’ But neither of them have said anything like that, and I don’t think in any real way they’re being held to account for this.” — Vox’s The Weeds 4/1/2016

TL; DR: In all of the Republican tax plans, the benefits mostly go to rich people at the cost of cutting programs that benefit everyone else.

So if you vote for one of them in November, pretty soon you’ll find yourself saying:

Lauren Dillon is the Research Director at the Democratic National Committee.