Posts Tagged ‘trickle-down’

Coronavirus Stimulus Tax Break Benefits Millionaires

April 16, 2020

Coronavirus Stimulus Tax Break Benefits Millionaires

“More than 80 percent of the benefits of a tax change tucked into the coronavirus relief package Congress passed last month will go to those who earn more than $1 million annually, according to a report by a nonpartisan congressional body ….

The provision, inserted into the legislation by Senate Republicans, temporarily suspends a limitation on how much owners of businesses formed as ‘pass-through’ entities can deduct against their nonbusiness income, such as capital gains, to reduce their tax liability. The limitation was created as part of the 2017 Republican tax law to offset other tax cuts to firms in that legislation.

Suspending the limitation will cost taxpayers about $90 billion in 2020 alone, part of a set of tax changes that will add close to $170 billion to the national deficit over the next 10 years, according to the Joint Committee on Taxation (JCT), the nonpartisan congressional body.”

— “Tax change in coronavirus package overwhelmingly benefits millionaires, congressional body finds,” Jeff Stein, Washington Post

More:

“Coronavirus stimulus law has a tax loophole just for millionaires, report says,” Charles Duncan, McClatchy

“Millionaires to reap 80% of benefit from tax change in US coronavirus stimulus,” Amanda Holpuch, The Guardian

Related:

“White House, GOP face heat after hotel and restaurant chains helped run small business program dry,” Jonathan O’Connell, Washington Post

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Trump Coronavirus Response: Tax Cuts

March 2, 2020

Trump Coronavirus Response: Tax Cuts

President Donald Trump has been laser-focused on the deadly Coronavirus epidemic, especially one frightening symptom, the biggest stock market dive since the 2008 financial crisis. This is big trouble for Mr. Trump, who has been taking credit for rising stock prices for the past three years. After putting public health expert Mike Pence in charge of the nation’s Coronavirus response, Mr. Trump prescribed his no-fail remedy for Wall Street’s ills: tax cuts. They’ll even pay for themselves! Too bad they won’t treat disease or pay for America’s health care.

More:

“Trump officials discuss tax cuts, other emergency measures in hopes of tackling coronavirus fallout,” Jeff Stein and Ashley Parker,” Washington Post

“Coronavirus Shows the Problem With Trump’s Stock Market Boasting,” Neil Irwin, New York Times

“The coronavirus gores Trump’s bull market,” Robert J. Samuelson, Washington Post

“Trump tries to shift blame as virus outbreak rattles markets,” Jonathan Lemire and Josh Boak, Associated Press

“Only Doctors Can Save the Markets From the Coronavirus,” Binyamin Appelbaum, New York Times

Update:

“Dow plunges despite Fed’s emergency rate cut to stem coronavirus panic,” Rachel Siegel and Thomas Heath, Washington Post

Related:

“Stock markets are headed for a 40 percent plunge, says economist who predicted financial crisis,” Summer Meza, The Week

“Global stock markets have lost $6 trillion in value in six days,” Maggie Fitzgerald, CNBC

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Trump Awards Arthur Laffer the Medal of Freedom

June 20, 2019

Trump Awards Arthur Laffer the Medal of Freedom

Failed businessman Donald Trump awarded the Presidential Medal of Freedom to economist Arthur Laffer. “Freedom” here must refer to freedom from reality. Dr. Laffer popularized the “supply side” theory of economics, which holds that if you cut the taxes of rich people so they have even more money, some of it will magically trickle down to society’s less wealthy. This fiction was a favorite of Herbert Hoover, daddy of the Great Depression, and early-onset Alzheimers Ronald Reagan. You can see why the notion would be attractive to Mr. Trump, who became a millionaire at the age of 8.

Arthur Laffer revived this “supply-side” zombie with a visual aid, the “Laffer Curve,” allegedly first drawn on a cocktail napkin in 1974. That theoretical chart, based on wishful thinking and zero data, purports to show that tax cuts for the rich will boost the economy and pay for themselves. While the curve’s drinking-binge origin tale seems apt, it’s a fiction, mythologized by Dr. Laffer’s hype man, conservative pundit Jude Wanninski. The story is now enshrined in GOP dogma and, embrassingly, at the Smithsonian.

Donald Trump, despite the populist rhetoric of his campaign, enthusiasticly slashed taxes for the rich once elected, which helped no one but the wealthy. The medal award is yet another example of Mr. Trump doubling-down on a lie. How could the Laffer Curve be untrue when Arthur Laffer got the Medal of Freedom? Of course, maybe he really got it for co-authoring a book of fawning fiction called Trumponomics.

More:

“Trump is giving Arthur Laffer the Presidential Medal of Freedom. Economists aren’t smiling.” Elizabeth Popp Berman, Washington Post

“Trump Awards Medal to Controversial Tax-Cut Champion Laffer,” Margaret Talev and Justin Sink, Bloomberg

“Trump Awards Kook Art Laffer for Inventing Fake Curve,” Jonathan Chait, New York Magazine

“Why are we still pretending ‘trickle-down’ economics work?” Morris Pearl, The Guardian

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Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com

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Trickle-Down Economics Is Trickling Away

October 11, 2018

Trickle-Down Economics Is Trickling Away

That old voodoo economics has the president in its spell, but where’s the magic?

Noah Smith: “If Trump’s corporate tax cuts end up having no observable effect on workers’ pay, it will be the final blow to the supply-side worldview.”

— “Trump Puts Supply-Side Economics to Its Final Test,” Noah Smith, Bloomberg

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Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com

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Trump Economic Policy

August 10, 2016

Trump Economic Policy

Donald Trump — meat purveyor, TV reality star, and Republican presidential candidate — trotted out some phrases disguised as an economic plan on Monday. They were phases familiar from the last 30 years of the GOP’s trickle-down, deregulating, big-corporate, no-taxes-for-the-rich philosophy, the failed policies that crashed the world economy when Republican leadership was last inflicted upon the nation, making the rich even wealthier at the expense of the rest.

After lambasting the Republican elites and their policies during the primaries, why is Mr. Trump suddenly embracing the old GOP worldview? Looks like he wants those wealthy guys to fund his general election campaign– he’s peddling high-dollar tickets to fundraising events at the homes of the rich. No wonder he named “six guys named Steve” and other billionaire hedge fund and real estate speculators as his “economic advisers“.

More:

“Sliding Trump Seeks Solidarity With Establishment He Spurned,” Sahil Kapur, Bloomberg

“Donald Trump Sells Out to Trickle-Down Economics,” John Cassidy, The New Yorker

“Trump’s Frankenstein economics,” Ben White, Politico

Related:

“Donald Trump wants to slash your child care bill. But he’s doing it all wrong.” Jeff Spross, The Week

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Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com

Comments are welcome if they are on-topic, substantive, concise, and not boring or obscene. Comments may be edited for clarity and length.

The New GOP Math: ‘Dynamic Scoring’ Doesn’t Add Up.

January 7, 2015

The New GOP Math: 'Dynamic Scoring' Doesn't Add Up.

Republicans now rule Congress, so the House of Representatives has a new rule: “Above All, Do No Math.” From now on, there’s no problem that can’t be solved by cutting taxes for rich people and corporations. The GOP calls this “Dynamic Scoring,” but others have called it “Voodoo Economics” and “Magical Thinking.” Why? Because it doesn’t work. Paul Ryan wants to call it “Reality-Based Scoring,” but clearly he lives in an Alternate Reality.

The assumption underlying “Dynamic Scoring” is the “Trickle-Down Theory” of economics. In a pre-automobile age this was called the “Horse-and-Sparrow Theory,” because if you fed your horse enough oats surely some would filter through the horse, fall on the road, and feed the sparrows. Then as now, this produces pitifully few oats but a whole lot of horsecrap.

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Happy New Year for the One Percent

January 1, 2015

Happy New Year for the One Percent
Happy New Year, rich people. The GOP Congress is in and the laws of mathematics are out, so the fix is in for people of wealth. Poor and middle class wage earners will pay for even more tax cuts for The One Percent. Ring out Neo-Conservatism and ring in Neo-Feudalism!

More:

“Sorry, GOP, tax cuts don’t pay for themselves,” Joel Dodge, The Week

“Behold, the magic kingdom of dynamic scoring,” Froma Harrop, Seattle Times

“Republicans’ magical thinking is immune to the facts,” Robert B. Reich, Baltimore Sun

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Image by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht,NotionsCapital.com

Comments are welcome if they are on-topic, substantive, concise, and not boring or obscene. Comments may be edited for clarity and length.

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Millionaire Hostage-Takers

December 5, 2010

Millionaire Hostage-Takers

Republicans in Congress are holding middle class American families hostage at the bidding of their wealthy masters. GOP Congressmen refuse to continue Bush-era tax breaks for middle-income households unless millionaires get tax breaks, too. Astoundingly, they persist in arguing that tax breaks for the rich produces “trickle-down” benefits for the rest of us, the same nonsense they used to lead the country into financial ruin in the first place.

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