Remember the Tax Cuts and Jobs Act of 2017? Sure you do. It was sold to the American public as a stimulus for the U.S. economy that would benefit U.S. corporations and workers across the board, supercharging overall economic growth to levels never seen before.
But two years after the tax cut bill passed, it has instead lived up to the name given to it by most economists who understand the basics of how the economy works: The GOP tax scam plan.
The non-partisan Congressional Research Service notes in a just-released report that the tax scam had almost no effect on the economy and has done virtually nothing for American workers, according to HuffPost:
The measure triggered a wave of corporate stock buybacks that benefited investors more than anybody else, according to the new study.
“While evidence does indicate significant repurchases of shares, either from tax cuts or repatriated revenues, relatively little was directed to paying worker bonuses, which had been announced by some firms,” CRS economic policy experts Jane Gravelle and Donald Maples wrote in their report.
There were lots of reports of worker bonuses shortly after the Trump-GOP tax cut passed, but that had nothing to do with the reduction of the corporate tax rate from 40 to 21 percent:
But it turns out that even the most generous assessment of corporate bonuses ― a conservative group counted more than $4 billion worth of the largesse ― amounted to 2% or 3% of the value of the corporate tax cut. And the law might not even deserve credit.
“Worker bonuses could also be a result of a tight labor market and attributed to the tax cut as a public relations move,” Gravelle and Maples wrote.
The tax cut was also going to pay for itself, according to President Donald Trump and top White House officials. Economic growth would be so accelerated that it would totally offset the loss of revenue from reduced tax rates. That too is a bust:
The report estimates that GDP growth will offset 5% or less of the revenue lost as a result of the tax cuts — meaning the GOP promises that the law would pay for itself may come up 95% short.
But wait, it gets even better!
Wages were going to go through the roof, Republicans promised. Everyone would be making so much more money, meaning they would spend more, and that would give the economy another shot in the arm. Did it? Nope. As HuffPost notes:
“Real wages grew more slowly than GDP: at 2.0% (adjusted by the GDP deflator) compared with 2.9% for overall real GDP,” the report stated.
It also said that the real wage rate for production and nonsupervisory workers grew by just 1.2% ― essentially meaning lower- and middle-wage earners saw hardly any boost to their paychecks.
So, let’s review:
- Economic growth from the tax scam is minimal.
- The plan does not even come close to paying for itself, adding trillions to the federal debt.
- Wages have not grown in an appreciable manner.
- The rich got MUCH richer. The rest of us didn’t.
Here’s the question we all need to ask as the 2020 election begins to come into view: Who is to blame for this massive tax scam lie that redistributed more wealth to those who need it least? Answer that for yourself and then vote accordingly.
Featured Image Via NBC News