Though sold as a pain-free tax cut for most Americans, the Republican plans favor the rich and carry hidden dangers for Social Security, Medicare and other key social programs, as Dennis J Bernstein describes.
By Dennis J Bernstein
The Democrats and the entire progressive community are up in arms about the Republican tax-cut plans, which budget experts say will shower the wealthy with tax breaks while raising taxes on some middle- and working-class families. The plans also could flood the federal debt with another $1.5 trillion in red ink over the next decade.
The legislation is now in the hands of the U.S. Senate where some modifications are expected in order to bring onboard a few Republican holdouts, but the Senate version does not play well either with critics alarmed about the potential debt-induced raid on Social Security and other key social programs.
Rep. Ro Khanna, D-California, put it this way: “Not only would the GOP tax plan blow a hole in the deficit, but as a result, it would trigger major cuts to programs that many Americans depend on, including a $25 billion cut to Medicare. This plan is a disaster for the middle class….[It] clearly demonstrates that they think it’s better to serve the interests of the very wealthy than everyday people. Shareholders and corporate executives do not need any more favors handed to them.”
What follows is an in-depth primer, from a progressive perspective, on the tax cut legislation. I spoke about it with Josh Hoxie on Nov. 21 in Boston. Hoxie has studied the proposal extensively and written about it as well. He is the Co-Editor of Inequality.org, based at the Institute for Policy Studies in Boston.
Dennis Bernstein: Let’s start with some background on the Estate Tax. What is the estate tax and how was it established?
Josh Hoxie: About 100 years ago, Teddy Roosevelt and a few others saw that wealth was concentrating in fewer and fewer hands. We had a funneling of wealth up to the upper class and…