Day: November 21, 2017

Benjamin Studebaker, The Republicans are Trying to Use the Tax System to Attack Their Political Enemies:

We’re seeing lots of good pieces which point out that many of the claims the Republicans are making about their tax plan are not true, that the plan favors the rich at the expense of the middle. But today I want to make another point about the plan, one that doesn’t seem to be getting the attention it merits. You see, it’s not just that the Republican plan helps the rich and hurts the middle. Those distributive consequences are real, and they matter, but this goes deeper than that. The Republican plan specifically targets liberal and left-leaning groups in the country for tax increases. It is an assault on the political neutrality of the tax system.

The tax system is anything but politically neutral (get married, own a home) but Studebaker points out two targets of the current plan: grad students (taxing doctorate candidate stipends) and blue states:

The Republican plan also intends to prevent Americans from deducting their state and local income and sales taxes from their federal taxes. This means that if you live in a blue state with higher taxes and more generous public services, the federal government will double tax you. The goal of this is obvious–to drive business and investment out of high-tax blue states. In the short-run, this enriches low-tax, cheap-service red states. In the long-run, this forces blue states to lower their income and sales taxes to remain competitive, turning them into red states. Lower taxes at the state level means gutting public services and dishonoring pensions. Gutting public services takes money from the public schools and from the state universities. It helps privatization campaigns convince ordinary people that government programs aren’t worth maintaining, which leads state governments to divert even more resources away from the public system to voucher-based private alternatives. Those funding diversions further run down the public services, leading to a spiral of state abandonment.

Lest we lay all this on "Republicans," let's note that the Clintonites also favor "austerity," just perhaps not this blatantly.