With last year’s corporate tax cuts, Republican lawmakers were finally able to step up and deliver on their most cherished of theories: The more you cut a rich person’s taxes, the better off the common rabble will be. Lobbyists for the uppermost class have been extremely insistent on this for decades, would-be wonks like Rep. Paul Ryan went to the trouble of drafting up visual aides with big, bold letters saying so, the party finally had a president who would sign anything they put in front of them and there ya go.
It’s been nearly a year, so how’s that working out? It’s working out exactly as actual economic experts predicted; a short-lived stimulus that is already receding, in exchange for long-term structural problems that will threaten the economy, exacerbate inequality and screw up social services for a generation.
The New York Times has a rundown. The short version is that great gobs of the promised corporate re-investment are instead being translated into stock buybacks and other payouts to shareholders–which is what analysts predicted.
Workers, however, continue to be eaten alive. Which is also what analysts predicted.
Many companies also said they would use tax savings to create jobs. But the Just Capital research finds that, since the tax cuts were passed, the 1,000 largest public companies have actually reduced employment, on balance.
As for the deficit? Ah, what can we even say. Back during the Great Recession the Republican Party was aghast at the notion of stimulating the economy via short-term government spending, no matter how many jobs had been lost or how long the crisis might drag on. It was all garbage, and they were lying, and if you see any pundit explaining away their actions during the recession compared to their actions now without noting that it was garbage and they were lying that pundit is Bad and Wrong and is probably trying to sell you something. Because while Republicans insisted that stimulus during a recession was an insufficient reason for burdening the federal government with more debt, the Paul Ryan brigade lit the damn budget on fire with this one.
The growing budget gap means the Treasury must borrow more to keep the government running. The Treasury expects to borrow a total of $1.338 trillion from global investors this calendar year. That would be 145 percent higher than the $546 billion the federal government borrowed last year. That would be the highest level of borrowing since 2010, when the American economy was struggling to recover from the great recession.
This, too, is what the analysts predicted, which suggests that economic experts continue to largely know what they are doing and conservative pundits, lobbyists, lawmakers, and yacht-polishers continue to very much not know what they are doing. But we’ll give Paul Ryan a bit of the benefit of the doubt on this one, because it’s almost certain the massive deficits that Paul Ryan swore would not happen are, in fact, intentional, and what’s going to happen next is that Paul Ryan, having ejected himself from Congress soon after inking this particular deal, will begin a new post-House career next January as a “wonk” lobbyist insisting that the way to fix all this will be to Screw.
The trillion dollars the Republican Party just handed out to the wealthiest class must now, Paul Ryan will say on your television, be bled out of retirees by slashing Social Security. We will need to install a new blue-ribbon panel of conservative experts to decide which sick Americans deserve their current healthcare coverage and which should be sent to A Farm Upstate in order to relieve the burden on taxpayers. Did you know that in other countries, the infirm and the elderly are driven up into the mountains and abandoned there, when their families can no longer care for them? Something we might want to consider, Rand Paul will say while pointing to a large, alarming-looking chart.
And really now, this whole business of feeding the poor rather than leaving them to starve on the streets feels a wee bit too Europe, the deficit hawks will sniff.
So that’s what’s coming. The Republican tax plan succeeded in a half-year of self-praise for Republican strategists followed by a long-term, systemic botch of the national finances. It will be left to the Democratic House to try to do something, anything, to fix it, while the whole time remaining Republican lawmakers will be insisting that the only possible fix is to double, nay triple, those tax cuts while allowing corporate titans to use elderly Americans as garden mulch.
The obvious answer is that taxes need to be raised back up to noncatastrophic levels. The lobbyists and pundits on television, all wearing suits that cost more money than your car, will tell you that we can’t have that, so it’s anyone’s guess what Plan B will be.