Lefties and journalists -- often one in the same, of course -- have been sharing charts on social media purporting to illustrate how much better Joe Biden's first major legislative achievement ('American Rescue Plan') will be for average Americans than Donald Trump's opening foray ('Tax Cuts and Jobs Act'). Because they appear to confirm typical partisan stereotypes designed to reflect poorly on Republicans, these have rocketed around the internet:
President Trump's first major economic legislation vs. President Biden's, in @TaxPolicyCenter distributional tables: https://t.co/yq8ZNZM6Cf pic.twitter.com/x0LkoenmgF
— Jim Tankersley (@jimtankersley) March 8, 2021
The top 20% of households reaped 65% of benefit from Trump’s tax cuts. The bottom 20% got 1%.
— Steven Rattner (@SteveRattner) March 8, 2021
The American Rescue Plan gives aid to those who actually need it. My @Morning_Joe chart: pic.twitter.com/Ptq9Hpu3KA
First off, we are comparing apples to oranges here. The Trump/GOP tax cut reduced Americans' tax burdens and simplified the tax code overall. It did not represent the government mailing one-off (taxpayer-funded) checks to people; it implemented a new policy to allow American families and businesses to keep more of the money they earn every year (reminder: the economy grew and government tax receipts increased after these tax cuts). Second, there are reasons why the data points above look the way they do. The so-called "COVID relief" bill will send direct one-time payments to Americans earning under a certain income threshold, excluding wealthier Americans. The tax reforms and cuts necessarily impacted higher earners because they were -- and still are -- paying disproportionately high percentages of all federal taxes:
The top 25% of households pay 71% of all federal income taxes. The bottom 50% paid 4%. So that would be why. https://t.co/ehPy81Xxhg pic.twitter.com/GEFzSUf8Pm
— Ben Shapiro (@benshapiro) March 8, 2021
Policymakers spent decades cutting taxes for the non-rich so low that they ran out of taxes to cut for them - which is why the 2017 tax cuts had to save the rich the most $, they were paying the far most.
— Brian Riedl ?? (@Brian_Riedl) March 8, 2021
Thus, spending hikes are more popular today - can be targeted to non-rich. https://t.co/LdwRL0qxr7
Let's pause here for a moment. It's important to recall that after the 2017 tax cuts -- opposed by every Congressional Democrat -- were implemented, alongside the Trump administration's reduction of regulatory red tape, the US economy absolutely boomed. Top Democrats attacked the tax reform as an "armageddon" that would hurt (or even kill!) working and middle class people. That was all a lie. Incomes increased significantly, with workers benefiting disproportionally. A global pandemic from China temporarily shattered that prosperity, but the economy was rocking. Both 'Trump vs. Biden' graphs above actually prove what Republicans argued all along, contradicting Democratic misinformation: The tax cuts and reforms did benefit Americans in every income bracket, on average. An analysis from a left-leaning think tank confirmed that in the first full year with the Trump/GOP tax law in effect, the overwhelming majority of taxpayers enjoyed a reduction:
Looking exclusively at the individual federal income tax changes in the law, TPC found that almost exactly two-thirds of Americans received a tax cut, averaging nearly $2,200 -- including 82 percent of middle-income earners, who averaged a tax cut of $1,050. When all provisions of the law are examined, 80.4 percent of earners received a tax cut, including 91.3 percent of the middle class. Just 4.8 percent of the population saw their taxes go up, a disproportionate number of whom are higher-income earners who itemize deductions and live in high-tax states and jurisdictions. Broadly speaking, 80 percent saw a cut, 15 percent saw no change, and less than five percent saw an increase. This is the data.
The New York Times even felt compelled to produce a fact check to disabuse large numbers of Americans, including a large share of Democrats, of the false notion that they were not receiving a tax cut from the GOP-passed law. Democrats and their media allies had lied to them so incessantly that people simply did not believe the factual truth about what the law actually did, weirdly clinging to a semi-religious belief that the new law did nothing for the non-rich -- or even raised their taxes. This was simply untrue, the Times reported, triggering a wave of fury from blind ideologues incensed by their own financial benefit. Indeed, among the small fraction of Americans who saw a tax hike due to the law, a disproportionately large percentage were wealthier people from high-tax blue states, who could no longer write off their state and local tax bill as a federal deduction. According to 2018 IRS data, tax burdens fell for every income group in the country except for those making more than $1 million annually. And it's Democrats who've been pushing to restore the 'SALT' deduction that was eliminated in the 2017 law, which would amount to a tax cut for wealthier blue state taxpayers:
People who say the blue bars are bad also think the orange ones are fine pic.twitter.com/Ux3wpFnxTY
— Donald Schneider (@DonFSchneider) March 8, 2021
Democrats decry the trajectory of blue bars as too slanted toward the rich (while ignoring the boosted after-tax income demonstrated in every income bracket), yet want to implement a tax cut for the rich signified by the orange bars. Remarkable but true. Meanwhile, please consider this observation, followed by just a few examples of the incredible waste and non-COVID-related provisions included in the monster legislation Democrats just passed on a party-line vote:
Almost as if the GOP was willing to support a compromise, targeted bill worth hundreds of billions of dollars, on top of the trillions they’d already voted to authorize https://t.co/eSGS14o0Zk
— Guy Benson (@guypbenson) March 10, 2021
It wasn’t just cities. We also bailed out failing pensions to the tune of $86 Billion. No reforms needed. https://t.co/uVHaG12THj
— AG (@AGHamilton29) March 9, 2021
Wow. The BidenBucks bill pays federal employees up to 15 weeks of paid leave at $1400 per week if they have to stay home to virtual school kids.
— Phil Kerpen (@kerpen) February 25, 2021
You get $1400 once. They get it every week for 15 weeks. Swamp takes care of swamp.https://t.co/4A7ktpm1Zc
And the "stimulus" will give more to states w/ higher unemployment even though those states are causing their own unemployment w/ policies that aren't saving lives! Oh, and take a guess which party governs almost all of those states? These policies are so cynical. pic.twitter.com/waaFGrP3Rp
— Ryan Fazio (@ryanfazio) March 10, 2021
An outrageous percentage of the supposedly urgent emergency spending doesn't even begin to go out the door until next year, when the pandemic will very likely be in the rearview mirror. Most of the money for schools doesn't get spent until 2023 and beyond. This was a $2 trillion 'never let a crisis go to waste' moment for the Democrats, and they're taking full advantage. They're able to do so because of the GOP's meltdown in Georgia. I'll leave you with even 'moderate' Democrats already turning their attention to their next multi-trillion-dollar project:
?? Joe Manchin tells #AxiosOnHBO that he'll block Biden's next big package — $2 trillion to $4 trillion for climate and infrastructure — if Republicans aren't included. https://t.co/I8zANwdurg
— Axios (@axios) March 8, 2021
Eventual tax hikes for everyone are becoming more and more likely.
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