The tax plan that passed through the U.S. Senate last Saturday will not save American citizens an extra $4,000, as promised. Instead it will cost many of us in the long-run through increasing taxes on middle-class Americans and adding $1.4 trillion to the national debt.
Meanwhile massive corporations will receive a huge tax cut, leaving them with more money.
According to the age-old theory of trickle-down economics, leaving corporations with more money will encourage them to spend some of that extra money on expanding their operations and creating more jobs, in turn.
That mentality defies basic economics. Employers don’t add extra jobs when they have piles of extra money sitting around. Business owners increase their employment when the demand is there for their products.
If you’re taking more money out of the wallets of middle-class Americans, you can guarantee that demand for services will go down instead of increase.
Income tax brackets released by Business Insider, Inc. estimate that one of the hardest hit groups of people would be working- and lower middle-class Americans. But the most shocking aspect of the Senate plan is the slashing of corporate tax rates, taking it down to just 20 percent, which is a smaller percentage than most Americans could be paying starting as early as 2018.
If you earn a total household income of at least $38,700, then you’ll be paying at least 2 percent more on your income in taxes than major corporations. This won’t save Americans money, as promised by the Republican senators who passed the bill. It will leave many of us with less money to live on, not more. A 2016 census concluded that at least 12.5 million Americans are living in poverty, and that number will likely rise.
Also alarming is the impact the tax plan could have on the national debt, which already rests at $20.5 trillion and could rise another $1.9 trillion by 2019. In a recent poll conducted by the University of Chicago’s Booth School of Business, 37 of 38 economists said they believe the GOP tax plan will raise the national deficit more quickly than it would increase the United States economy.
The worst part of the bill, though, is the various sneaky aspects inside the bill that will forever change how people live their lives. The GOP has again tried to defy the law of the land and attempted to outlaw a Constitutionally protected right for women to have an abortion by attempting to define personhood. Graduate students will have to pay taxes on grants they receive for their education. Companies will be able to drill in previously protected wildlife areas in Alaska. The list goes on and on.
It is highly unlikely that this plan will truly save working and middle class families $4,000 each year. In an article published in The Royal Purple on Nov. 2, 2016, several professors at UW-Whitewater urged students and faculty to remain skeptical about various tax plans proposed by the GOP and other political parties. Their insight still rings true today.
We can’t sit idly by and watch as the legislature tries to rush this reckless plan through the House of Representatives before the holidays. Be better and contact your representative in Congress. Use your voice before it’s too late and call out this egregious plan for how it will harm the average American’s life.