This month was pretty jam-packed. Between Trump’s tax plan, his budget proposal, and the House health care plan roll-out, there’s a pretty clear pattern emerging: HUGE gains for the wealthy and corporate interests while the low- and middle-class get absolutely pummeled. Here’s a quick round up of what’s happening and what you need to worry about:
Trump’s Tax Plan:
Trump’s “principles for tax reform” is a pretty vague plan. His administration has said that there will be no absolute tax cut for the wealthy, but Independent analyses have shown that the richest 400 individuals (who make more than $300 million a year) would get an average tax cut of $15 million A YEAR.
What’s worse is that his team keeps insisting that these tax cuts will “pay for themselves” by spurring greater economic growth. This has been a talking point for tax cuts in the past and has literally never happened.
More likely than increased growth is that these tax cuts will put us in a multi-trillion-dollar hole. Be skeptical of any talk about “dynamic scoring” which exaggerates the benefits of tax cuts, or “the magic asterisks” which assumes unrealistic growth to pay for reduced revenue.
Other terms that might fly around during the tax- reform debate are “border adjustment tax,” which is a Republican proposal to generate revenue with some serious flaws, and “sunsetting” which will replace any real comprehensive reform with large tax cuts that will go unpaid.
Trump’s budget proposal:
On Tuesday, the Trump administration released its budget request for Congress called “A New Foundation for American Greatness.”
It cuts low-income programs by an astounding amount and has some pretty egregious accounting errors that left it trillions short of its goal of balancing the budget.
While Trump claimed he would not cut Social Security, Medicare, or Medicaid, this budget cuts Social Security Disability Insurance by $64 billion, and Medicaid by $610 billion over ten years (in addition to over $800 billion in cuts under the new Republican ACHA plan).
It cuts SNAP dramatically, and a broad swath of programs that support low-income and working-class Americans through health care, job training, and community development.
While his team calls this budget “compassionate,” the rest of the country is afraid that they will lose the government support that saves millions of people from living in poverty every day.
Congress gets the ultimate say in how our country spends its money, but pay close attention to the showdown between deficit-hawks who prioritize eliminating government debt over spending on low-income programs, and Democrats who value increased investment in government programs.
On Wednesday, CBO, the agency in charge of scoring legislation released its score of the Republican Health Care plan (ACHA). They were so intent on repealing Obamacare, they rammed a bill through the House without any public debate, official estimate of its impacts, or bipartisan support.
To nobody’s surprise, the score was atrocious. It’s estimated that 23 million people will lose coverage over the next ten years and that people with a wide array of pre-existing conditions and the elderly will be subject to huge premium increases. Coverage will be skimpier, premiums will be higher, fewer people will be covered, and it will disproportionately hurt low- and middle-income families.
Incidentally, this would also provide a tax break to the wealthiest Americans to the tune of $660 billion over ten years, paid for by cutting Medicaid (health care for low-income individuals), and eliminating subsidies for middle-income families. This is a tax cut IN ADDITION TO Trump’s already skewed tax plan.
Now, it’s up to the Senate to take this House Bill and reconfigure it so it resembles something other than a dumpster fire. Keep an eye out for key Republicans representing states that benefited greatly from Obamacare.
You also may have heard some discussion about raising the debt limit this week. This fall, Congress will have to vote on whether to raise our debt limit or default on our nation’s borrowing.
If they don’t raise the debt ceiling, the government would be unable to meet its obligations like, pay Social Security benefits, for example.
Conservatives will likely push for spending cuts in exchange for their vote to raise the limit, while Democrats will likely be looking for a clean-raise (with no stipulations). Mnuchin (The Secretary of the Treasury) has called for a clean increase before they recess this summer so there is no showdown come fall.
Watch for the political battle that ensues between the Freedom Caucus demanding spending cuts in exchange for a raise, and hope they raise the limit sooner rather than later to avoid any government shutdown.
This month was full of Russia-related headlines too:
Sally Yates, former AG, testified before Congress that Trump ignored her warnings about Flynn being compromised by his ties to Russia; Trump fired FBI Director James Comey, and lied about why he did it; Trump divulged classified national security information in a meeting with Russian Foreign Minister that could potentially threaten US-Israel alliances; Congress appoints a special counsel to investigate Trump ties with Russia.
There was also that other time Trump leaked sensitive national security information to Duterte, President of the Philippines.
Trump embarked on his first foreign trip to the Middle East, the Vatican, Belgium, and Italy which, so far, has only produced hilarious internet memes.