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So Bozo the great orange clown has been set up to be the front man for this day when the entrenched rich and powerful reap a windfall and the middle class get thrown temporary crumbs to get them to fall in line. Depending on the sales job each party undertakes, Trump could be the hero or the fall guy for the Republicans going into 2018. Regardless of how this plays out politically and electorally, the rich get a huge permanent tax break and the poor and middle class will get a huge cut in Medicare and Social Security as those are the only two areas big enough to offset the giant fiscal hole in revenues this tax cut causes. However, those benefit cuts are down the road for most working Americans (i.e. after 65) so they won't feel them right now. And the right wing media empire will solely focus on the 2% increase in your paycheck in 2018 to the exclusion of anything that represents fair and balanced reporting. The chumps, the middle class across the great red middle of America will not even realize that their future financial and health security has been sold to pay the rich today. The final point, I fear the Democrats absolutely do not have the fire power, the guts nor the smarts to effectively fight the extreme power of the right wing tax cut sales propaganda we will start to see immediately in January.
By lowering the corporate tax rate, the bill hopes to encourage companies to invest, and in particular to create new jobs. Under Republican logic, these will result in less of a deficit and greater tax receipts despite the lower rates. Another logic says that the US is already in a situation of de facto full employment--there are more jobs than takers, and those who aren't working either have skill deficits or are in the wrong place geographically. If this logic is right, then lowering the tax rates will simply produce inflation and greater deficits. Someone is right and someone is wrong. But the die is now cast. We shall see in the next few years which scenario plays out.
Thanks for your reply, Mr./Ms. Langostain. Very interesting information. In effect, there are two large pools of talent, both of which are no doubt highly motivated at this point, who could use a bite at the apple. Let's hope they get their chance! I live in the Netherlands and in Italy, and the anecdotal evidence I've seen particularly in Italy certainly confirms the Huffington Post theory.
Thanks for your reply, Mr. Zimmerin. You raise a good point on technology limiting inflation, which is particularly visible in the electronics sector. On the other hand, imports, particularly from China, have also for years accustomed us to acceptable products of all kinds at low prices. To the extent that imports are limited, we may see an accentuation of inflationary tendencies.
I did not vote for the man but this caps quite an amazing year for the President even though no one wants to admit it. He passed the tax bill, tilted SCOTUS in republicans' favor, revoked or delayed over a thousand regulations (many from Obama), defeated ISIS, all but killed Obamacare, propelled the stock market, etc..
And it is all the more amazing considering he did it while completely being undermined in every possible way from the media and facing utter vitriol from hysterical liberals. LOL...just go on and keep telling him what he can't do.
The one thing people should take away from this is that elections matter. Control of the government matters. Sounds silly but a significant amount of Americans did not vote. You have only yourself to blame.
This is a terrible bill. It provides an unneeded stimulus at the expense of future generations, who will almost certainly have to endure a return to higher personal taxes and steep cuts to entitlements.
TE is going to hate to have to report that
As the article notes, time will tell if the tax bill is a win or a time bomb. However, the fact that this legislation received not a single public hearing or any real independent analysis should be concerning from an economic policy perspective and equally concerning for the USA democracy. For my part, I am also very skeptical that any or any significant profit growth by corporations will be either passed on to employees or re-invested - this is trickle down theory. As well, for the family that gets the $1000 AT&T bonus or the $2000 tax cut, if inflation grows and interest rates rise won't these small gains be wiped out? I am overall not convinced either TRUMP or the REPUBS have the necessary macro-economic understanding to make reasoned or reasonable decisions.
Shameful. They give bread crumbs to the masses in order to deflect their attention while delivering the juicy steak on a silver plate to the rich.
Just as Jeff Merkley asked, what could have been achieved by spending that trillion dollars on fixing America’s infrastructure, or making health care more affordable, or improving the education system.
I understand why Trump populists may be upset he didn’t enact his populist positions, though as the OP makes clear, they’re willing to forgive or just ignore almost anything. My point is, it is a good thing that this aspect of his agenda has languished.
We are not discussing populism in a vacuum, but through the lens of Trump’s positions. Which of those populist positions are you upset he didn’t achieve?
So the founding fathers were communists. They put the provision to tax on Congress.
Your remark has got to be one of the nuttiest I’ve seen of late.
The rich also tax everyone else. It’s called interest. Some 30-40% of a product’s price services it. Inflation is another tax levied by interest.
I am disappointed that The Economist takes such a sanguine view of this legislative travesty. Its every page reflects Republican hypocrisy, cynicism, myopia and corruption.
But what is truly maddening about your analysis is that nowhere do you reference the fact that House Speaker Paul Ryan and his cronies have made no secret of their next legislative priority: to slash Medicaid, Medicare and Social Security. Just how popular do you think such measures will be with Trump voters, who up to now foolishly have clung to the hope that Mad King Donald would target everyone else's benefits--not theirs?
You'll need to check your history. Social Security was created by FDR and Medicare/caid was created by LBJ. But again, attack the one party who's proposing changes because they aren't what you'd design and ignore that the other is trying to make it actively worse by your own measure. It's very revealing.
You're arguing over the shares of the current crop (at the expense of future crops I might add). I'm saying the only way they can expand future crops is to become more productive. Again, this is immutable. Ironically, you attack increased productivity in the next breath.
So you'll ignore economic law in favor of anecdotes? Good to know. So how about the billions promised in increased investment by a multitude of companies following the bill's passage or do those not apply?
There's a 15% tax on all current overseas profits and no further US taxes on those going forward. Read up on the bill, you don't know what you are talking about.
As I said, total fail.
Since when they explode the deficit. Man, you should really study some Econ.
Re: "Am I kidding myself? What do YOU think?"
I am not sure, really, Perrodin. My guess is this battle (if you can call it a battle) will take a while to see to its end. Trump is not doing anything for the country in the starting point of the policies he proposes. The entity he wants to make great again is himself and his clan of children and inlaws. No one else. Even his own party speaks not with one vocie. But his personal croonies go along, as they stand to get some crumbs in the fall out. In few governments of modern times has nepotism been so brazely played and played to the hilt. It is a strange time. The ascendence of ignorance over knowledge, utility over ideologuery, are, of course, the forces that voted him in. These 2 elements have merely begun to burn; it will be a while before they burn themselves out. Then there is the usurpation of "God" as the derivation of earthly power [even as what this "God" teaches and requires of man have a thousand and one versions; no man is "God", but there are many many "Man-Gods" in America, as you know - they quote the Bible just about every time they aim to do something injurious to a fellow human being, perfectly sanctimonious and straight-faced about it] as a smokescreen and sword and shield to justify all policies and infighting and outfighting. All of these present a scary prospect not only for the country, but the rest of the world. America is a mighty power on all counts by far - it is the richest, the militarily strongest; It is also abundantly endowned with natural resources and brainpower if only it will know how to utilize the latter. At the moment, all are squandered in the services of raising the greed level of its richest 1%. Quite a few educated "elite" (the other "deplorables") have already left the country, returning to where they came from. "Elite" are not stupid people, even as they may be pale-faces dandruffed bookworms. The brain-drain has begun even before Donald got to his orange throne. This is the beginning of the beginning of the end. But you can't convince his supporters (you'd be lucky if you are allowed to say it, first amendment right fashion, without being trolled by various "Godders" and TE community board's Famous Bizarros - vicious haters of un-yankies, pretend-can't-readers, whose aim in community forums is to sabotage all informed and intelligent exchange of ideas of others by offering up waterfalls of nonsequiturs as readily as natural incontinence demands. I don't know. I hope for the best but am prepared for the worst.
Will he be elected again? He may. It is now up to the stars, I think. America, in my humble and honest opinion, deserves better.
Proposals by leading Democrat thinkers make your screed against the Republicans re entitlements look very foolish. One party is focused on reigning them in, the other aims to expand them further.
Competition for capital has grown immensely these past few decades and the markets have become extremely liquid. With demand up, relative to labor, its share of return increased. This isn’t a bad thing mind you. It’s the reason why world poverty has plummeted during the same time. Mankind benefits from the efficient allocation of capital on a global level. The challenge is to make your country a more attractive destination.
Allows capital to return tax free thereby increasing business investment which in turn increases worker productivity, which in turn increases wages.