While Americans are feeling queasy about a violently gyrating stock market that reacts on a daily basis to the reckless and clueless actions of an unbalanced and irrational President, there’s nothing that will quite prepare them for the shock they’re going to receive over the next couple years, thanks to the Republican Party’s tax giveaway to the nation’s wealthiest that Trump signed into law last December.
But Nobel-winning economist Paul Krugman is here to tell them. And the news is not good.
So you go out for dinner with a wealthy acquaintance. “I’ll take care of everything,” he says, and orders you a hamburger. Then he orders himself an expensive steak and a bottle of wine, which he doesn’t share. And when the waiter comes with the check, he points at you and says, “Charge it to his credit card.”
Now you understand the essence of the Trump tax cut, signed into law a little over two months ago.
Taxes are there for a reason. The reason is they pay for things like Social Security, Medicare, roads and bridges, police and fire departments, schools, libraries, a clean place to live, all kinds of services most Americans take for granted. But the real big ones are Social Security and Medicare, which keep elderly people from falling through the cracks and winding up on the street or in some God-awful filthy nursing home, or hitting up their children for money so they can survive.
Right now baby boomers are well into peak retirement age. Very soon there are going to be disproportionately more old people than young people in this country, at a level that’s unprecedented in American history. And as these millions and millions of people get old, they will not stay healthy. They will get sick. They will fall. They will run out of money, and those lost tax revenues Trump just shoveled into the pockets of the nation’s millionaires are going to be needed to pay for the programs that keep them alive. Tax revenues in this country were already falling, thanks to Republican Congressional control of the country’s fiscal well-being for the last eight years. Now, they’re about to go over a cliff, with $2.3 trillion in projected deficits looming as far as the high can see. And those lost tax revenues are never coming back.
Remember Republican House Speaker Paul Ryan crowing and tweeting about the teacher who proclaimed the Republican tax cut was going to put an extra $1.50 a week in her pocket? He quickly took that Tweet down, but the internet never forgets. Krugman knows why he he took it down:
How’s that $75-a-year saving going to look when the teacher finds out that, partly because of that tax cut, her mother’s Medicare plan has been converted into an inadequate voucher system and Medicaid won’t pay for her father’s nursing home care?
The lie that people like Paul Ryan and his Republican cohorts foisted on Americans was that these huge tax cuts for corporations were going to benefit us all by creating jobs and increasing wages. So far it hasn’t worked that way, although corporate America has made a pretty show of it, touting one-time bonuses while leaving wages stagnant. In fact the money has been used mainly by corporations not to invest in R & D, not to expand (because there’s no burgeoning market of eager consumers to expand into), but rather by giving themselves huge paydays in the form of stock buybacks which boost highly compensated corporate officers stock coffers’ on an exponential order of magnitude:
So far, we’ve seen about $6 billion in bonuses versus more than $170 billion in stock buybacks, that is, handing money to wealthy stockholders. And money spent on buybacks is money that isn’t being invested in plants and equipment, the supposed point of the tax cut.
So for the vast majority of Americans, that tax cut is going to be worth about as much as a degree from Trump University. But the real pain is yet to come, when Americans finally realize just how badly they were ripped off:
Donald Trump and his allies pretended to give you a gift, but they gave themselves and their wealthy patrons much bigger gifts — and they’re going to stick you with the bill. You’ve been scammed.
This is a Creative Commons article. The original version of this article appeared here.