To many of us, Robin Hood was one of our childhood heroes, whether our parents read us the stories, or we watched swashbuckling Errol Flynn in the movies. We loved the Sherwood Forest bandit who stole from the rich and gave to the poor. The tale has marked overtones of Christian charity, as well as the triumph of good over evil.
We are on the cusp of a great overhauling of the American tax code, conceived by one party in secret, with no public hearings, no debate, and it is being rushed to a vote in a Republican-dominated Congress with a Republican in the White House desperate for some legislation to sign. This is the story of Robin Hood in reverse, where Prince John and the Sheriff of Nottingham are robbing the poor to pay the rich.
What do we know about the 500-plus pages of this “tax reform?” The other day, Senator Mark Warner informed us that the Republican-controlled “Senate Budget Committee just voted — without debate — to increase the national debt by $2.2 trillion, all to pay for tax cuts for large corporations and the wealthiest Americans.” The House bill cuts the top rate that large corporations pay from 35 percent to 20 percent, the biggest one-time drop in the big-business tax rate ever. Despite strident insistence by phony fiscal conservatives like Dave Brat, the vast majority of genuine economists have proved that so-called “trickle-down” economics is demonstrably false. Here is the ugly truth.
Huge tax breaks for the rich and the big corporations are permanent; small tax breaks for the middle and lower income groups are temporary and will disappear after 2023, causing our taxes to increase. Just for fun, I calculated the effect of these bills on my own taxes – they’ll go up by almost $2,300. Try it for yourselves. You may be surprised.
The wealthy get a lot of other benefits in the bill. The estate tax goes away entirely in 2024 for the richest 108 families subject to the current provisions. The mega-wealthy also would get to keep charitable deductions and they no longer would have to pay the alternative minimum tax (AMT), a safeguard against excessive tax dodging that's been in place since 1969. Overall, the non-partisan Tax Policy Center found that two-thirds of bill’s benefits go to the top 1 percent by 2027.
Hypocrisy abounds: the bill allows big corporations to deduct new inventory from its taxes, but eliminates the $250 tax break for teachers who purchase supplies for their students. Almost all itemized deductions for the rest of us regular people are going away, except for three. The final House bill keeps the deductions for charitable donations, property taxes up to $10,000 a year, but the mortgage interest deduction would be capped at $500,000 (down from $1 million now). This tax bill is being sold as as simplifying the tax code; reducing the loopholes; filing your taxes on a postcard. False. The wealthy and the multinational corporations, along with their attorneys and accountants will be making billions of dollars while scamming the government out of badly needed revenue.
In America, there is arguably no engine of advancement as powerful as a college degree. At the moment, low and middle-income Americans can deduct up to $2,500 a year in student loan interest, but this bill eliminates that deduction at a time of mammoth student debt. In addition, graduate students who get tuition waivers because they teach or do research would now have to pay income tax on the waivers, resulting in 300% increases in their taxes.
The Republicans have repeatedly and unsuccessfully tried to repeal the Affordable Care Act. Not giving up, the Senate bill would eliminate certain financial pillars of the ACA in an indirect attempt at repeal. The impartial Congressional Budget Office (CBO) estimates it will take health insurance away from more than 13 million people and raise rates for millions of others in the lower and middle classes. The draft Republican legislation will also eliminate the tax deduction for medical expenses next year – so, no more help with your medical expenses. If you’re sick, you really are on your own. You could die. They don’t care.
I have touched on just a few illustrations of the horrors contained in this budget bill. Republicans are sinking to new depths of recklessness, irresponsibility and hypocrisy so that the current occupant of the White House can sign something – anything – into law before the end of the year. Meanwhile, Congress faces and even more critical and pressing problems. The Children’s Health Insurance Program expired in September leaving 9 million children in limbo. Nothing has been done for the Dreamers. Congress must come up with a budget deal by the end of this week to avoid a government shutdown. Trump doesn’t care.
We are being ripped off. Where is Robin Hood when we really need him?
Editors Note: This has been reposted with the author's permission, and originally appeared in the December 2nd print edition of the Culpeper Star Exponent, and will not be available on line until the following week. For now it is only available on-line here.