We say “hit” because it was the usual leftwing label-and-bash fest, long on nasty rhetoric and not only devoid of evidence, but in fact contrary to well known facts and data.
His opening sentence calls the TCJA, “terrible … and a massive redistribution of wealth to the already super-rich.”
The federal Internal Revenue Service, however, shows that the demonized top one percent of earners pay 38 percent of all personal income taxes, while receiving only half that portion – 19 percent – of total personal income. Further, the top five percent of earners garner 34 percent of income but pay 59 percent of income taxes.
So what did Trump and the Republicans’ TCJA do from that starting point? It gave the bottom 80 percent of tax payers the net cuts and the top quintile (20 percent) the net increases, according to estimates by the Heritage Foundation. (No government agency has made estimates of these distributional effects.) The second and middle quintiles got most of the net cuts, but the lowest and fourth quintiles also got some.
Notably, the super-rich one percent got the biggest net increases. And the top quintile got the total net increase even though those folks already pay two-thirds of the total income tax bill.
In sum, from a personal income tax already radically skewed progressive, the TCJA extended the massive redistribution previously in place to further burden the top quintile and especially the one percent to provide more benefit to the lower- and middle-income 80 percent. The opposite of Lyngar’s claim and standard leftwing narratives.
Another fact leftwingers conveniently overlook is that in a primarily market economy, people get income and accumulate wealth mainly by delivering value to others (their customers, employees and stockholders). Hence, contra their view that the wealthy don’t deserve what they get and have, on average the wealthy actually benefit the public interest as providers and producers while the lower income groups are a net burden on it as consumers of subsidy.
Lyngar also complains that the corporate income tax has decreased over time as a fraction of federal revenues. He adds: “A small slice of corporate America is pocketing obscene wealth, while regular people are left with the bills.”
He fails to understand what nearly all economists know: Corporations don’t so much pay income taxes in the sense of their owners carrying the actual burden in reduced earnings as they pass them on to their customers via higher prices and to their employees via lower wages and reduced employment. Moreover, the TCJA cut America’s marginal corporate tax rate from by far the highest among developed countries to somewhat above the world average.
When he adds rhetoric like “obscene” to his complete ignorance of the facts and their clear contradiction of him, it’s no wonder he’s a freelance writer. Who would hire such a hyper-aggressive ignoramus? He doesn’t even attempt to define or justify the use of “obscene.”
He also hyperventilates that health care and his other sacred cows “are being driven to the brink of failure in a systematic, enthusiastic dismantling of our communities.” He says “every worthwhile program inevitably fails from starvation or neglect” and there’s a “certain evil genius to it.”
But the facts are that in the mid-1960s both federal spending and revenue were below 17 percent of our economy. Today spending has risen to nearly 21 percent while revenues are about 18 percent. And 70 percent of the federal budget goes to health care and social and income security.
The cheap accusations of “enthusiastic dismantling,” “starvation or neglect” and “evil genius” are just more lies using sophomoric rhetoric. To paraphrase James Carville, “It’s the spending, stupid!”
Following the false and completely unsupported labeling of President Trump as a “racist,” he claims “Trump’s GOP has declared war on all of us.” This illustrates the point that leftists often hate and lie. For many leftists, hating and lying are their stock in trade.