Welcome to Progressive Army’s live coverage of CNN’s townhall-style debate on taxes. Our coverage will begin at 8:30 pm ET / 5:30 pm PT, 30 minutes prior to the start of the debate, and will continue throughout the event.
Hi, everyone! I’ve been looking forward to this all day. Watching Cruz get his behind handed to him is always a good way to end the day.
Welcome to Progressive Army’s live-blog coverage of tonight’s CNN debate
on the tax bill. Senators Bernie Sanders and Ted Cruz are the
headliners, but the debate will also feature Tim Scott from South
Carolina on the Republican side and Maria Cantwell from Washington for
Looking forward to it, Jami. Pamela Getz will be joining us as well, so we’ll have a solid panel to watch Cruz and Scott attempt to defend the indefensible.
The big news today is that the Senate Budget Committee voted on straight party lines to report their bill out of committee and send it to the Senate floor for a vote perhaps as early as this week. At this point, one is even surprised they went through the Budget Committee – they ignored the committee process altogether for their abortive health-care repeal. What’s democracy and parliamentary procedure, anyway?
If the Senate were to pass their bill, that’s not the end of the story: as the House tax bill is different, they would then have to thrash out the differences between the House and Senate versions and then both chambers would have to vote again to approve an identical piece of legislation.
According to the Congressional Budget Office, the Senate tax plan would harm the poor while slashing taxes on the rich. The CBO found that the negative impact on people earning less than $30,000 a year begins as soon as 2019. https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/reconciliationrecommendationssfc.pdf
Either the House or Senate bill is, by any barometer, a disaster: corporate tax rates would be slashed from 35% to 20% while raising taxes on the lower and middle class once their individual tax cuts sunset. Also, state and local taxes would no longer be deductible, and neither would (in the House bill) the interest on student-loan debt. All in all, a massive upward distribution that, according to the non-partisan CBO, would explode the debt by $1.3 trillion.
Some pre-game reading material:
The Senate Bill, of course, also repeals the Obamacare health mandate, meaning 4 million fewer insured by 2019 and 13 million more by 2027.
Oh, and the estate tax (after a few years) will be eliminated on estates worth over $5 million dollars. Is that you? I doubt it, if you’re reading this blog.
Time for me to be a little petty here, but I hate Ted Cruz’s voice. Also, he’s a liar. Taxes go up on the poor and middle class.
Ted Cruz starts, expectedly, by saying the tax bill benefits everyone. First lie in under 30 seconds – perhaps a CNN forum record.
All corporations are not seen as equal and to say that this will help small mom and pop “corporations” is dishonest right out the gate
Time for me to be a little petty here, but I hate Ted Cruz’s voice. Also, he’s a liar. Taxes go up on the poor and middle class. https://www.washingtonpost.com/news/wonk/wp/2017/11/16/senate-tax-bill-cuts-taxes-of-wealthy-and-hikes-taxes-of-families-earning-under-75000-over-a-decade/
Sanders responds that 50%-60% of the tax breaks go to the top 1% and wonders what bill Cruz is talking about. So do we.”Who in their right mind believes we should give tax breaks to millionaires, billionaires and large corporations?” He also points out that this will explode the deficit, using it as a pretext to cut Medicare, Medicaid, Social Security and other programs.
Tim Scott admits that he doesn’t think about the numbers when he thinks about tax reform. Perhaps he should.
Maria Cantwell repeats that middle class taxes will go up while corporate taxes will be slashed, without interest in investment and wages. “We shouldn’t be a 1% society,” she says, echoing a Sanders talking point.
Tim Scott talks about expanding the child tax credit. Sanders rebuts: 87 million middle-class households will see their taxes go up by the end of the decade. Working class benefits are temporary; corporate tax breaks are permanent. Basically, a verbal body slam of Scott.
Scott is not responding to Sanders’ point that working and middle class tax reductions are TEMPORARY. He’s talking about next year. What about following years?
And as time goes on, the middle class sees a continued increase in taxes and little to no increase of those earning over $75K
Cantwell points out that the expanded child tax credit benefits people earning up to $500,000 a year. Surprise: every tax cut in these bills are skewed upwards.
And of course, every time we have a live blog, we have a drinking game: “We want to cut your taxes.” Drink.
Information on SALT
Question about the elimination of the state and local deduction (SALT), about which Pamela included information below.
Effect of Repealing the SALT Tax Deduction. A study from the Tax Policy Center estimates repealing the deduction for state and local taxes (SALT) would cause the average federal income tax bill to rise by $2,348 nationally for those filers who claim the deduction.
Thirty percent of tax filers itemize, rather than claiming the standard tax deduction, and 95 percent of them claimed a state and local tax deduction in 2014, according to the Tax Foundation. The same figures held for 2015, when 44.7 million tax filers claimed itemized deductions on their returns, according to IRS data. Higher-income households are more likely to itemize, so they are more likely to claim the deduction. “About 10 percent of tax filers with incomes less than $50,000 claimed the SALT deduction in 2014, compared with about 81 percent of tax filers with incomes exceeding $100,000,” the Tax Policy Center says in a brief on the topic.
Cruz fudges on SALT; doesn’t answer the point about it effectively raising taxes – in BLUE states, as he points out.
The Republicans are not telling the whole story on SALT
Some high-income households, however — about 5 million — are required to pay the alternative minimum tax, which reduces or eliminates the SALT deduction. The AMT, as the Tax Policy Center explains, “requires many taxpayers to calculate their liability twice—once under the rules for the regular income tax and once under the AMT rules—and then pay the higher amount.”
Taxpayers in certain states are more likely to take the deduction because they live in high-income and high-tax states. “Six states—California, New York, New Jersey, Illinois, Texas, and Pennsylvania—claim more than half of the value of the deduction,” the Tax Foundation says. Some of those states are also among the most populous.
The Pew Charitable Trusts has created interactive maps that show the percentage of filers in each state claiming the deduction and the average amount claimed by those who take it. For instance, 45.7 percent of tax filers in Maryland in 2015 took the state and local tax deduction, with an average claim of $12,931, while at the opposite end of the spectrum, 16.9 percent of filers in South Dakota claimed an average deduction of $6,098. The maps also show breakdowns for only income, sales or real estate tax deductions.
The average claim nationwide in 2015 was $12,471.
Interesting how the Republicans are trying to play off eliminating state-and-local tax deductibility as a measure that goes after the wealthy: trying to wrap themselves off in a sort of pseudo-liberal rhetoric.
Hasn’t the job creation myth been debunked? https://www.nytimes.com/2017/08/30/opinion/corporate-tax-cuts-jobs.html
From Fox Last year:
Cantwell is stumping more for her own state than for the nation as a whole: this isn’t just about Washington State, Senator.
The Republicans are trying to peddle the line that the US corporate tax rate, 35%, is among the highest in the industrialized world. But as even Forbes pointed out, the EFFECTIVE tax rate corporations pay is much lower:
According to NPR, factoring in deductions and tax credits, the effecitve corporate tax rate is about half:
Pay attention to phrases like cutting taxes for everyone, giving everyone a child tax credit. This seems to assume that those making under $20k would be on an equal playing field as someone earning more than $75. You have to wait all year to wait for that tax return. We need to worry more about people surviving day to day and not dangling “handouts” (as the Republicans would have called a higher refund a few years ago)
And this doesn’t even count all those corporations that take advantage of incorporating in tax havens such as the Caymans. Going after tax havens and tax evasion, however, pays no part of this bill, even after the revelations of the Panama and Paradise Papers.
More rebutting of the “highest corporate tax rate” myth:
Sanders discusses repealing the estate tax, which benefits 2/10 of 1%, in response to a question by a restaurant owner.
More from the Forbes article:
There may be some extremely large or profitable small businesses that would benefit from this proposal, but they are incidental beneficiaries, not the principal winners. The principal winners are hedge funds and other investment firms, real estate developers, and the sorts of professionals whose job creation prowess typically extends to a handful of assistants and associates.
Sanders discusses that taxes are about the kind of society we want to create – and that the repeal of the healthcare mandate and the increase of taxes for graduate students talks to what kind of society the GOP wants.
Speaking of, we have something for this. An article by Progressive Army’s Raven Payne http://progressivearmy.com/2017/11/22/gop-proposed-taxation-tuition-waivers-devastating-graduate-education/
Scott attempts to make corporate tax cut out to be something that will trickle down to everyone else. Where have we heard this before? Cantwell reminds that 75% of that cut will go to dividends and shareholders – idle money for the idle classes (my words, not hers).
Obamacare! DRINK tigerpixie
Cruz now uses the coded word “jackboots”, an obvious Nazi reference: taxation for him is a breaking-down-the-door act of confiscation. A classic libertarian view. Watch the words that are used, always.
Cantwell’s “me-too”ism is classic centrist Democratic discourse: “We want to cut corporate taxes too, just not so much.” Where has that gotten the party?
Sanders points out that large corporations pay an effective rate of 14%, a point I made earlier. Scott picks up on Cantwell’s willingness to also cut corporate taxes: this is where “me-too”ism gets you: playing right into the hands of the adversary.
“Corker, a prominent deficit hawk, said he wants his fellow Republicans to add a backstop measure to prevent tax cuts from ballooning the deficit. Johnson said he wants a bigger tax break for “pass-through” businesses, which include small mom-and-pop enterprises as well as some large, non-corporate businesses.”
Tax cuts do not, nor have they EVER “created jobs” https://www.thenation.com/article/corporate-tax-cuts-dont-create-jobs-they-enrich-ceos/
Wait, did Cruz just mention Calvin Coolidge, the president whose policies led to the Great Depression?
Soooo, familes have to wait for a tax holiday to afford the costs to send their kids back to school but this tax plan will only help when you get that once a year tax refund with a child tax credit. Assuming that you even have kids.
Imagine another Cantwell on the Democratic side of this debate instead of Bernie. “Ted Cruz has the right goal: growing the economy.” WTF? This is a disaster of a tax bill, everyone knows it, and she’s giving Cruz kudos for wanting to grow the economy?
Scott says nothing changes with the removal of individual mandate – “the subsidies remain”. After he and his cohorts tried to gut healthcare all year, now he’s suddenly proud that the subsidies exist.
Here’s the Democrat’s fatal flaw: They are arguing in the fallacious framework of Republican talking points. Challenge the underlying premise.
#TaxDebate – With the GOP Tax Plan:
– The Walton Family (Walmart) save $53 billion
– The Koch Brothers save $34 billion
– The Trump family saves $4 billion
– 99.8% of Americans get no tax break. Many pay more.
This plan is a gift horse to the oligarchs.
— Michael Salamone (@MichaelSalamone) November 29, 2017
Cantwell makes the basic point that more uninsured people will raise rates for everyone else. Great argument for a universal health care plan (which she’s not making).
Cantwell is actually handling the tax discussion better than Sanders in my opinion. Even if she isn’t full Leftist, it’s vitally important to destroy this tax scam bill.
Scott says this this is a tax plan that we can be proud about, to deafening silence from the audience.
Cantwell is the only one challenging the lie that tax cuts for corporations automatically mean more jobs but she isn’t forcing the Republicans to answer for that fallacy.
This is trying to smooth over a plan built to help the wealthy and that will continue to help them while the middle class suffers.
From our own Raven Payne
What Republicans don’t want you to know about Saint Reagan:
The Bush tax cuts substantially increased annual budget deficits and were responsible for a third of the national debt by 2018. Similarly — but at a time when the nation’s fiscal outlook is far worse than during the Bush era — the Senate bill would add at least $1.5 trillion to deficits over ten years. As we’ve explained, that’s part of a two-step Republican fiscal agenda: when deficits rise, those who supported the tax cuts will likely label these deficits as unacceptable, point to spending as the culprit, and call for the kinds of deep program cuts that Republicans have outlined in their long-range budget plans — cuts that would mostly affect low- and middle-income households.
Yet the tax bill that the Senate Finance Committee has passed would deliver 62 percent of its net tax cuts in 2027 to just the top 1 percent of households, the Tax Policy Center (TPC) estimates — and that’s without accounting for its effects on health coverage. By comparison, the tax cuts that President Bush and Congress enacted in 2001 and 2003 delivered 27 percent of their benefits to the top 1 percent when fully phased in, TPC estimates (see graph).
Closing statements: Sanders and Cruz sticking to their boilerplate messages. Cantwell focuses on the bill’s getting rid of key deductions (the hidden tax increases). Scott talks about everyone getting a tax cut – and the fact that he can highlights his opponents’ failure to drive home the point that any cuts they get will be TEMPORARY (as opposed to the corporate cuts – permanent).
And that’s it for tonight’s CNN “debate” – such as there are on corporate American TV. Thanks to Jami, Pamela and Benjamin for their comments and insights. See you next time.
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