Thursday, November 30, 2017

Tax Cuts, Profits, Markets, and Lies


You don't need to be an economist. A couple of carotid arteries with decent flow, at least one eye and/or ear, and you know that the Republican tax-cuts-for-corporations/soaring-job-growth/pay-for-themselves bullshit is just that. Bullshit.

First of all, corporate profits are already at all-time highs (Thanks, Obama). Unemployment is at its lowest in years (T,O). When there's unmet demand for their products and profits to be made, businesses expand capacity and hire more workers. Cutting corporate taxes has nothing to do with it. Cutting them for working people, maybe so: more to spend, more demand. But the Republican tax plan, by all accounts, gives little or nothing to the middle and lower (ie, purchasing) class. It's a selfish and self-evident ruse.

Corporate CEOs have already made clear that any windfall they get from tax cuts will go to investors (and, therefore, themselves.) The stock market is about investors. Its response to the promise of corporate tax cuts is about potential investors' profits, not a statement of confidence in the economy at large. In fact, one would predict, assuming these dishonest tax cuts for the wealthy and corporations become law, there'll be a lot of profit-taking after an initial rally. Because a tanking economy has always followed Republican tax cuts, and smart investors know it.

Of course, as silly Marko Rubio just said, unbagging several cats, they realize deficits will soar under their plan. "Plan" being the operative word: step two in this pre-programmed calamity will be to tell older Americans, present and future, how sorry they are, but they have no choice, in order to balance the budget, but to cut Social Security and Medicare. Did we promise otherwise? Fake news.

And thus will the circles of hell be completed. It's obvious. It's greedy. It's disastrous for all but the already wealthy. And it'll be cheered by those who'll be hurt the most, i.e., the Foxified, the die-hard Trumpists, the willingly deceived.

[Image source]

5 comments:

Anonymous said...

The resulting deficit will be about a trillion according to the OMB.

Then they will tell us "Sorry, no Medicare, No Social Security, we gotta balance the budget!

EugeneInSanDiego

Anonymous said...

They let Children's Healthcare Insurance lapse 60 days ago.

Today: Sen. Orrin Hatch said the nation can't afford the Children's Health Insurance Program, unless other spending cuts are made.

Will anything short of a revolution stop these people?

EugeneInSanDiego

Anonymous said...

Turns out it's not OMB but:
..."the Joint Committee on Taxation finding that the bill would cost the federal government about $1 trillion dollars over a decade, even when taking into account increased revenues from economic growth."

See:
http://talkingpointsmemo.com/dc/tax-committee-gop-bill-will-increase-deficit-by-1-trillion-even-with-growth

EugeneInSanDiego

Sidney Schwab said...

"Sorry, no Medicare, No Social Security, we gotta balance the budget!

Another way of saying what I wrote: " ...step two in this pre-programmed calamity will be to tell older Americans, present and future, how sorry they are, but they have no choice, in order to balance the budget, but to cut Social Security and Medicare ...".]

fonzie said...

Once again, AMERICA FIRST, is bull sh_t straight from the butthead in chief and his republicant cohores. From Business Insider column, Oct 23rd:

According to a new study, however, foreign investors could end up being bigger beneficiaries from the GOP's tax reform plan than America's middle class.

Steven Rosenthal, a senior fellow at the Urban-Brookings Tax Policy Center, estimated the potential financial benefit for foreign holders of US-domiciled companies' stock in the first year under Trump's tax proposal and compared it to the estimated benefit for middle-class Americans, those households making between the 40th and 60th percentile of incomes.

"I estimate that foreign investors own about 35 percent of U.S. corporate stock and thus would receive about 35 percent of the short-run benefit," Rosenthal wrote in the study, released Monday. "This translates to approximately $70 billion a year, about three times the $23 billion that all middle-income households would see under the preliminary estimates of the Big Six tax plan."

Then Bloomberg reports opinions of corporate and investment leaders:
.
'But there is also outright opposition by some corporate leaders, who cite concerns including increased economic inequality and the bill’s impact on the national debt.

Starbucks Corp. Chairman Howard Schultz, Berkshire Hathaway Inc. Chairman and CEO Warren Buffett and BlackRock Financial Management Inc. Chairman and CEO Larry Fink have all publicly criticized the legislation. Goldman Sachs Group Inc. Chairman and CEO Lloyd Blankfein said this month that with the economy at nearly full employment and growing at 3 percent, now isn’t the best time for tax cuts.

And John Bogle, founder of Vanguard Group, said Tuesday that the Republican tax plan is a “moral abomination” in part because companies will hand over the proceeds to shareholders.

“One of the flaws is that corporations are putting their shareholders ahead of the people that built the corporation,” he said at an event in New York sponsored by the Council on Foreign Relations.'

Such blatant BS and 39% of my fellow americans are so stupid by approving of this crap. Latest gallup poll number found in the Guardian yesterday.

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