Republican tax reform is either a profile in courage or a reflection of the need to change an out of control campaign finance system. A CNBC poll showed that Americans want Congress and the president to focus first on items other than tax reform.
Other polls indicate that most Americans are against cutting the corporate tax rate and a majority don’t believe corporations will put the tax savings toward job creation. So why has Congress made a tax bill with two-thirds of the proposed tax cuts going to corporations their priority? It is all about finances.
What is uncertain is whether it is about the country’s finances or campaign donation finances. By process of elimination we can find the answer.
The primary argument for cutting corporate tax rates is that corporations will use tax savings to hire more people. This implies that a lack of capital is keeping corporations from hiring more people. Are corporations starved for capital?
In 2016, corporate profits after taxes were near record levels at more than $1.7 trillion, nearly 10 times the 1986 level. For perspective, during this same period, inflation increased 2.2 times.
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It seems that rather than a profile in courage, some in Congress are focusing on their campaign finances as opposed to the finances of the country. Doubt this? Republicans have said as much. Consider these quotes:
“My donors are basically saying, ‘Get it done or don’t ever call me again,’” Rep. Chris Collins, (R-N.Y.) said.
“The financial contributions will stop,” Sen. Lindsey Graham (R-S.C.) said.
So much for courage. Maybe instead of a tax bill founded on false premises, someday Congress will have the courage to instead undertake meaningful campaign finance reform.
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