Trump’s Tax Cuts The Thrill of Victory and The Agony of Defeat

By Glen Reaux

On December 22, 2017, at the expense of the American people, the Republican Party experienced the thrill of victory with the signing by President Trump of their Tax Cuts and Jobs Act of 2017 aka BILLS-115hr1enr.  Many poor and middle class citizens were fooled by the standard unproven Republican mantra of lowering taxes creates jobs.  Unfortunately, for these Republican loyalist and independents that drank the Kool Aid there can only be one victor.  By mid 2019 after tax returns are filed they will realize that the only winner is the elite.  This elite class consists of the 1%, the wealthy, big business and the legislators that betrayed the American poor and middle class.   Starting in 2019 the poor and middle class will begin to suffer the agony of defeat and their economic pains will only get worse and worse each year after that.  As the chickens come home to roost, the effects of deficit spending which began to rise the moment the bill was signed will start to devastate the very lives of the vast majority of Americans.

 

 

In a normal business when revenues drop, spending is stifled, budgets are cut, people are laid off, fired, salaries are cut, debt increases, confusion and discord run amok.  In general, things just get ugly.  Governments are no different except for the scale of destruction, it’s much worse and the tax-paying poor and middle class citizens agonize, not the wealthy or the corporations.

 

Thanks to the Tax Cuts and Jobs Act of 2017, the projected FY 2019 budget deficit of $526 billion will more than double to $1085 billion.  In other, words the Republican tax law will cause more than a trillion dollars in deficit spending, less than two years after its passing.  These numbers are based upon the Whitehouse’s Office of Budget and Management Mid-season FY 2019 review released in July 2018.  Moreover, the  CBO Report The Budget and Economic Outlook for 2018 to 2028  estimates that revenues will fall by more than a trillion dollars, not rise by that amount.

 

Under the Trump Republican administration, deficit spending ballooned from $585 billion in 2016 to $665 billion in 2017 and $779 billion in 2018.  In 2018, the total national debt is $21.67 trillion and according to the Congressional Budget Office it will grow 100% to more than $42 trillion by 2028.  Literally, America is a bankrupt business and it was defeated by the Tax Cuts and Jobs Act of 2017.  America’s poor and middle class are about to feel the agony of defeat.

 

 

Most American tax payers don’t realize that they are in a contract with their government.  That contract states that as citizens you pay taxes in exchange for services.  The president and his cabinet are the CEO and executive officers of the government.  The Congress is the board of directors and the judiciary branch consist of police, lawyers and judges tasked with protecting the people from possible corruption by the nation’s executives and board of directors.  As an American citizen, you are an equal stock holder in the government.  Your contract states that this is a government of the people, by the people and for the people.  And, the people determine how money is to be raised (who pays taxes and how much).  The people determine how that money is spent (social programs, defense, law enforcement, infrastructure, health care etc.).  The people have a contract with government to ensure the economic and domestic welfare of our country.  At least in theory, this is how the system is supposed to work.  But when the people suffer the agony of defeat at the very hands of their elected leadership, the elite don’t suffer the masses of people do.

 

In the near future as deficits spiral out of control, each year that this Republican tax law is enforced, government budgets will be cut, jobs will be lost, small businesses will close and tax revenues will continue to fall.  In the early to mid 2000’s the world watched this type of economic disaster unfold in Europe.  The agonizing solution was austerity.  Austerity caused civil unrest, rioting in the streets and economic collapse in Greece, Spain, France and Italy.   The effects of this economic policy rippled into Portugal, the Irish Republic and the United Kingdom and nearly brought about the downfall of the European Union    Austerity is the implementation of government policies that result in drastic cuts in programs such as social security, Medicare, Medicaid, education, protective regulations, government jobs, government pensions, law enforcement and other services needed to ensure the domestic welfare of a country’s population.  Finally, when all of the cuts to services have devastated the people and deficits continue to spiral out of control, the dagger is thrust into the heart of the people.  Taxes are raised dramatically on the poor and middle class to cover the deficits created by the wealthy and corporations.  This is austerity, the agony of defeat.

 

Domestic social programs have been demonized by the wealthy as entitlements and welfare that suck the life’s blood out of our nation and the economy.  According to Webster, welfare is the health, happiness, and fortunes of a person or group.  Is welfare something evil?  The party of the wealthy and elite has been demonizing entitlements and welfare for more than 50 years.  They demonize entitlements because for the government to fulfill its contract with American citizens, the wealthy and corporations have to pay their fair share of taxes.  Paying their fair share of taxes is not the ideology of the elite or the Republican Party because they feel entitled.  So, demonizing the social services that help those that need it the most is a necessary tactic.  Remember, welfare is evil and the Republicans will not spend money on “the health, happiness, and fortunes of a person or group.”  Instead they give away money in the form of tax cuts to America’s wealthiest and to corporate America.  The elite perceive the Tax Cuts and Jobs Act of 2017 as their entitlement program simply because they are rich.  Take from the poor and give to the rich is Republican welfare.

 

An entitlement is something that you have a right to.  It is not some blood sucking leach that is going to kill this country.  Case in point, if you pay an attorney, an accountant, doctor or mechanic for services rendered, you are entitled to those services.  If you invest money you are entitled to the agreed upon returns.  You would not settle for less.  If you pay money into social security, you are entitled to get your return on investment. If you pay money into Medicare you are entitled to high quality healthcare.   So, why is demanding your returns on taxes paid a bad thing, an entitlement, evil welfare?  It’s not unless you believe the hype that the Tax Cuts and Jobs Act of 2017 was a law to benefit you.

 

The biggest winner in the 2017 tax law is corporate America that received a tax rate cut from 35% to 21% while totally eliminating the alternative minimum tax of 20%.  This means that corporations earning tens of billions of dollars may now get away without paying any taxes.  Isn’t this welfare?  The law changes tax policy for American companies abroad.  Corporations will no longer have to pay corporate taxes on money they claim to have earned abroad — this move would encourage companies to keep income in foreign tax havens instead of bringing it back into the country. The public was told that the corporations would bring this money home and create new jobs, research and opportunities.  Corporate monies brought back to the United States will be taxed between 8% and 15.5%, instead of the 35% current tax rate.

 

As an American citizen looking for economic relief from the 2017 Republican tax law, you have to ask questions about who benefits most and what does the nation’s future look like when corporate tax dollars are removed from our national economy?  What are you going to do when your government refuses to honor its contract to provide for the social and economic welfare of the country?  What are you going to do when austerity becomes the law for the middle class and not for the elite?  Are you going to enjoy the thrill of victory or suffer the agony of defeat?

gmendad

Mr. Reaux is a semi-retired entrepreneur and business owner. In the 80s he founded Simplx Marketing Corporation, an insurance loss replacement and claims management firm. The award winning documentary film company METV founded by Mr. Reaux, successfully provided television programming for more than 23 years. In 2013, Mr. Reaux co-founded LiveWell Insurance Products, Inc.

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