As the Republican Tax Cuts Take Effect

Well, the effects of the Republican Tax Cuts and Jobs Act (TCJA) are starting to be felt, and whether you're surprised depends on who you've been listening to. As Paul Krugman has frequent reason to say, "Facts Have a Well-Known Liberal Bias."

• The punch list of errors in the rapidly passed and little read bill is getting longer. Politico says "One snafu, which could potentially affect President Donald Trump’s real estate business, prevents people making various types of improvements to non-residential real estate from immediately deducting their entire cost, as lawmakers intended. An apparent typo means they have to instead take those breaks piecemeal over the next 39 years. That is already squeezing some companies’ finances, said Rachelle Bernstein, tax counsel at the National Retail Federation. “There are real economic implications right now,” she said."
 
• As of today the Americans for Tax Reform website says "4,000,000 Americans (and counting) will receive Trump Tax Reform bonuses," but that's less than 3% of total nonfarm employees in January (148 million according to the Bureau of Labor Statistics). And the use of one-time bonuses rather than pay increases has brought comment: "Something more permanent like increasing wages or increasing the 401(k) match is a better way to "boost the long-term savings" of employees," says Garrett Oakley, a certified financial planner at Betterment.
 
• Paul Krugman tells us that a Treasury Department technical paper from 2012 on the distribution of corporate tax changes in the economy "reached the inconvenient conclusion" that most of the tax effect is on the owners of corporate capital, and only a small share on workers. And those effects will take decades to appear. "So yes, this is a huge tax cut not just for the 1 percent, but for the 0.1%"
 
• Now a New York Times editorial, "Well-Heeled Investors Reap the Republican Tax Cut Bonanza," says we told you so.
  

  . . . the President and Republican lawmakers' claim[ed] that a corporate tax cut would "boost workers’ incomes even as it added $1.5 trillion to the debt that future generations would have to pay off.

Does Anyone Remember the Marshall Plan?

Unilateral	Multilateral
"We'll save a lot" by cutting aid to countries that oppose American positions, President Trump said in his first State of the Union address. "We don't care." 1	The United States has always given aid to promote American interests, as all countries do. Trump’s idea of the national interest is narrower than his predecessors.1
In a 2015 study by the Kaiser Family Foundation, the average respondent thought that 26 percent of the federal budget went to foreign aid. More than half the respondents thought the United States was spending too much on foreign aid.1	Only 1 percent of the U.S. federal budget goes to foreign aid — and about 40 percent of that is security assistance, rather than economic or humanitarian.1 It's the size of the U.S GDP, $19 trillion in 2016, that makes us the world's largest largest donor at $190 billion.2 And $76 billion of that is for American security interests.
Offended by Palestinian President Mahmoud Abbas’s criticism of the Jerusalem move, Mr. Trump ordered that $65 million in American aid be withheld from the United Nations refugee agency that serves the Palestinians.1 U.N. Ambassador Nikki Haley told Republican legislators that she was “taking names," adding: “I can’t tell you how helpful it is to have a Congress that backs us up. When y’all play the heavy, it makes it so much easier for me to play the bad cop with a smile.” 1	At least 11 countries, including Russia, Belgium and Norway, have rushed to fill the gap. The European Union held an emergency session to seek contributions to the refugee agency. The Israeli government has criticized the cut, which provides much of the schooling and health care in Gaza and the West Bank, relieving Israel of that cost. Carl Bildt, former Swedish prime minister and foreign minister, said Israel should cope with the fallout of the aid cut. “Why should we jump in there? It is the responsibility of the occupying country.” Israel is lobbying in Washington against the cutbacks.1
In 1947 U.S. Secretary of State George Marshall began the Marshall Plan to rebuild European economies after the devastation of World War II, and establish institutions supporting transatlantic security and prosperity for the next 70 years.3 The goals of the United States were to rebuild, remove trade barriers, modernize industry, make Europe prosperous, and prevent the spread of Communism. The United States gave over $13 billion ($140 billion in 2017 dollars) through the Plan. Public opinion polls in 1947 showed strong support for the Marshall plan among Americans.4	The German Marshall Fund of the United States is founded in 1972 through a gift from Germany as a permanent memorial to the Marshall Plan. On the 70th anniversary of the Marshall Plan in 2017, German Marshall Fund President Karen Donfried said, “Among its many achievements, the Marshall Plan is remembered as one of the most successful examples of a foreign assistance program.” 3

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¹ "Trump Wants to Aid Only ‘America’s Friends.’ If Only It Were That Easy," Steven Erlanger, New York Times, February 3, 2018
² "GDP (current US$)". World Development Indicators. World Bank. Retrieved 1 July 2017.
³ Merkel, Kissinger Stress Lasting Power of Transatlantic Partnership at German Marshall Fund Event, German Marshall Fund, June 21, 2017
⁴ "Marshall Plan," Wikipedia, retrieved February 4, 2018.
 

Buying Paul Ryans

Did the Kochs Contribute $500,000 to Paul Ryan After the GOP Tax Plan Was Passed?

Charles and Elizabeth Koch gave nearly half a million dollars to the House Speaker's fundraising committee after passage of the Republican tax bill.