Tax Relief for Billionaires

Reading who will see their taxes go down and who will see an increase under the proposed tax plans seems quite confusing.  Some middle class taxpayers benefit from one plan but see a tax increase under another. It seems so complicated until I step back and look at the broad strokes.  Then it becomes clear.  If you are very very wealthy and earn your money from investments you will receive a big tax break. For the average wage earner a good many will experience a tax increase under either the House or Senate proposal. Which average wage earner will see a tax increase and which will see a small tax break varies because the deductions which are eliminated vary.

The real winners in the tax overhaul are the very wealthy. The policy behind cutting taxes for the very wealthy is that by putting more money in the pockets of the very wealthy the economy will be stimulated and the middle class will benefit.  This is the trickle down economics of the early eighties. It did not work then and it will not work now.  Putting more money in the pockets of the very wealthy simply causes the very wealthy to become richer. It does not trickle down to the average person.

The very wealthy donors are pushing for the tax cuts, which in my humble opinion, makes it obvious that cutting taxes for the very wealthy is for the benefit of the very wealthy. The tax cuts won’t benefit the middle class. If the very wealthy are not sharing the pie now what makes one think the very wealthy will share the pie when the government puts more money in their pocket.  The recent leak of the Paradise Papers reveal what the wealthy do with their wealth, they hide it in foreign banks where the interest is not taxed.

There is a way tax cuts can stimulate the economy.  Providing a  substantial tax cut for the middle class  will most likely encourage  these folks  to spend the extra money in their paychecks locally on cars, appliances, home repairs, etc.  THIS  will stimulate the economy.  Then to ensure the deficit does not sky rocket or Medicare or Medicaid gets cut, the top marginal tax rates for the very wealthy should stay where they are or go up a bit. So unless you are very wealthy it does not matter if you identify as a Republican, Democrat, independent, liberal or conservative you should contact your representatives and object to these tax cuts for the wealthy.

Jim Black