Two quick takes on the new tax code. First is from the Congressional Budget Office telling us that the deficit will sky back to near $1 Trillion in 2018:
“Because the tax legislation reduced individual income taxes for most taxpayers, the Internal Revenue Service released new income tax withholding tables for employers to use beginning no later than the middle of February 2018. As a result of those changes, CBO now estimates that, starting in February, withheld amounts of individual income taxes will be roughly $10 billion to $15 billion per month less than anticipated before the new law was enacted. Consequently, withheld receipts are expected to be less than the amounts paid in the comparable period last year.”
According to the Washington Post, “The U.S. Treasury expects to borrow $955 billion this fiscal year. It’s the highest amount of borrowing in six years, and a big jump from the $519 billion the federal government borrowed last year.”
So, yes, Obama did borrow heavy to address the fiscal crisis and two wars Bush handed him but had reduced the deficit during his last six years. Republicans talk a good game, but deficits always seem to rise faster under their administrations, or when cleaning up messes from their administrations.
On a much brighter note, the much-heralded tax cut, which slashed the corporate tax rate from 35% to 21% (saving Apple $47 billion), and gave back an average of $51,000 to those in the top 1%, did result in a certain secretary getting $1.50 more per week in her paycheck. Join me in a slow clap.
Not surprisingly, after some reflection, Paul Ryan deleted his tweet about this fabulously fortunate woman already bearing her share of the benefits of trickle-down economics. Make America Great Again.
As we’ve said all along, the tax bill will deliver more money to the wealthy by raising deficits (borrowing money to give to the rich), while delivering next to no benefits to poorer people who really need the help.