top of page
Search

Paul Krugman and the GOP Tax Cut

Updated: Jan 6, 2019


The Pulitzer Prize winning economist has this to say about this major piece of legislation:


"The 2017 tax cut has received pretty bad press, and rightly so. Its proponents made big promises about soaring investment and wages, and also assured everyone that it would pay for itself; none of that has happened.


Yet coverage actually hasn’t been negative enough. The story you mostly read runs something like this: The tax cut has caused corporations to bring some money home, but they’ve used it for stock buybacks rather than to raise wages, and the boost to growth has been modest. That doesn’t sound great, but it’s still better than the reality: No money has, in fact, been brought home, and the tax cut has probably reduced national income. Indeed, at least 90 percent of Americans will end up poorer thanks to that cut.


Bear in mind that the one clear, overwhelming result of the tax cut is a big break for corporations: Federal tax receipts on corporate income have plunged."


(Hmm corporate benefit for corporate donors. Is that a coincidence?)


"And it certainly made most Americans poorer. While 2/3 of the corporate tax cut may have gone to U.S. residents, 84 percent of stocks are held by the wealthiest 10 percent of the population. Everyone else will see hardly any benefit.


Meanwhile, since the tax cut isn’t paying for itself, it will eventually have to be paid for some other way – either by raising other taxes, or by cutting spending on programs people value. The cost of these hikes or cuts will be much less concentrated on the top 10 percent than the benefit of the original tax cut. So it’s a near-certainty that the vast majority of Americans will be worse off thanks to Trump’s only major legislative success.


As I said, even the mainly negative reporting doesn’t convey how bad a deal this whole thing is turning out to be."

4 views0 comments

Recent Posts

See All

Total Eclipse of Priorities

Just over a week ago millions in the United States experienced an awe-inspiring total solar eclipse the Moon passed in front of the Sun and its shadow fell upon the Earth for a brief moment. This spec

Reclaim Our Government

The Very Real Costs of Non-Representative Government It is far too expensive Hello fellow political stonecutters! Join us for an informative and infuriating discussion with friend of the show and long

Bridges Falling Down

#DSOT was founded in Baltimore City.  Now, as often reported, there are partners/allies and folks not shopping on Tuesday everywhere/ in states throughout the country. It is a fact that this country n

Comments


bottom of page