After a Democrat Congressman introduced a bill to repeal Republicans’ tax cuts, President Donald Trump welcomed the bill as a help to Republicans in the upcoming midterm elections.
“A Democratic lawmaker just introduced a bill to Repeal the GOP Tax Cuts (no chance). This is too good to be true for Republicans,” Trump
said on Twitter on Monday, May 28. “Remember, the Nancy Pelosi Dems are also weak on Crime, the Border and want to be gentle and kind to MS-13 gang members...not good!”
The bill was
introduced by Rep. Jared Polis (D-Colo.) on May 23. It
would repeal the Tax Cuts and Jobs Act, cancel all federal student loan debt, and increase federal grants for college tuition.
Trump’s tax cuts—one of his campaign promises—slashed most individual income tax rates and nixed the personal exemption for doubled standard deduction, among other things. It also scrapped the individual mandate of the Affordable Care Act, which fined Americans who didn’t buy health insurance.
Another significant change was slashing the federal corporate tax rate to 21 percent from 35 percent and ending double taxation of foreign profits, while opening a way for companies to bring back to the United States over $3 trillion in profits stashed overseas.
The law also closed some tax loopholes.
The hope is that people and businesses will use the extra cash they’ve been allowed to keep on something productive that will help to boost the economy, thus offsetting the estimated $1.5 trillion hole that the cuts are expected to punch in the federal budget over the next decade.
The economy has broken several records over the past months, like that for the
most job openings in one month—6.55 million in March. This figure meant that there were almost as many job openings as the number of people unemployed.
Unemployment fell to
3.9 percent in April. The only time it has ever dropped to levels that low since the 1969 recession was in April 2000—and that was only for one month.
Black and
Hispanic unemployment rates have also fallen to the lowest levels in recorded history, and among
women, the unemployment rate has decreased to the lowest since the 1950s.
The economy has been
beating expectations for over a year thanks to a boost of confidence in the economy. According to a recent
YouGov poll, almost two-thirds of Americans view the economy positively and more than two-thirds believe that Trump’s policies, including the
cutting of regulations, taxes, and his planned investment in infrastructure, are at least partly responsible.
According to a Gallup poll, more than two in three Americans also believe it’s now a good time “to find a quality job.” It’s the most positive
response since Gallup started gathering responses on the topic 17 years ago.
Trump ran on a core promise of reviving the economy and now, the promising results look to boost his agenda in the Nov. 6 midterm elections.
In their bid to the voters, Republicans bet on Americans preferring to decide themselves what to do with their money, rather than handing them over to Washington for redistribution.
“Nancy Pelosi is going absolutely crazy about the big Tax Cuts given to the American People by the Republicans ... got not one Democrat Vote!” Trump
said on Twitter on April 20. “Here’s a choice. They want to end them and raise your taxes substantially. Republicans are working on making them permanent and more cuts!”
Indeed, Republicans plan to introduce a bill that would make the current tax cuts permanent for individuals instead of expiring by 2025 (the corporate tax cuts are permanent). They likely don’t have the votes now to break a Democratic filibuster in the Senate though.
Pelosi (D-Calif.), House minority leader, and Senate Minority Leader Chuck Schumer (D-N.Y.) proposed to scrap the tax cuts for the top 1 percent—individuals or couples earning
over $480,000. They expect the move would bring in about $5 billion a year, which they’d use to “increase teacher compensation, and recruit and retain a strong, diverse workforce,” The Hill
reported. With some
3.2 million public school teachers earning an average of some
$59,000, each would get a raise of about 2.7 percent.
Rep. Polis’s bill, however, aims to cancel the tax reform altogether and use the extra tax dollars to bail out 43 million people who collectively owe the government close to $1.4 trillion in student loans.
Government grants and loans to students allowed colleges to more than
triple tuition between 2005 and 2015. But some students have expressed apprehension about the value of their investment in a college education. Only one-third of students at 4-year colleges believe they’ll graduate with the skills and knowledges to be successful in the job market and workplace. Only about half believe that their major will lead to a good job,
according to a large-scale Strada-Gallup 2017 college student survey.
Polis’s bill, along with any other attempt to scrap the tax cuts by Democrats, has virtually no chance in the currently Republican-controlled Congress.
Correction: The article was updated to reflect that the previous federal corporate tax rate was 35 percent.
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