Search This Blog

Defying the Odds

Defying the Odds
New book about the 2016 election.

Tuesday, April 17, 2018

Tax Cut: A Political Flop

 In Defying the Odds, we discuss the tax issue in the 2016 campaign.  

Moments after the Republican tax overhaul passed in the Senate in mid-December, Majority Leader Mitch McConnell said that if he and his party members couldn’t sell the cuts to the American people, they should find “another line of work.”

Four months later, some GOP lawmakers who hoped the law would save them from defeat may have to start dusting off their resumes.
Some recent polls show that the majority of Americans still don’t support the tax law, despite an uptick in sentiment since the end of 2017. And a special House election in a conservative district of Pennsylvania in March delivered an upset victory to the Democratic candidate, who’d framed the tax cuts as a giveaway to the wealthy.
John Harwood at CNBC:
The new NBC News/Wall Street Journal poll shows that the tax-cut law, never broadly popular, has sagged in public esteem lately. Just 27 percent of Americans call it a good idea, down from 30 percent in January. A 36 percent plurality call it a bad idea, while the rest have no opinion.
Moreover, a majority gives thumbs-down on the plan when asked to consider its potential effects. Just 39 percent foresee a positive impact from a stronger economy, more jobs and more money in their pockets; 53 percent foresee a negative impact from higher deficits and disproportionate benefits for the wealthy and big corporations.
Jonathan Salant at NJ.com:
New Jersey voters overwhelmingly preferred to have a Democrat rather than a Republican representing them in the U.S. House, and the unpopularity of President Donald Trump and the GOP tax plan were major reasons, according to a poll released Monday.
The Democrats held a 54 percent to 35 percent edge in the Monmouth University poll's generic ballot holds up, threatening five Republican-held seats.
"This is pretty astounding," said Patrick Murray, director of the Monmouth University Polling Institute. "If these results hold, we could be down to just one or two - or maybe even zero - Republican members in the state congressional delegation after November."
...
Fueling the negative numbers for Republicans was New Jerseyans' disapproval of Trump's performance in office. More than 6 in 10 voters, 61 percent, disapproved of the job he was doing as president, compared with 35 percent who viewed his performance positively.
And 45 percent disapproved of the Republican tax bill, which disproportionately affected New Jersey and other high-tax states by capping the federal deduction for state and local taxes. Just 36 percent approved of the new law.
Lloyd Green sums up at The Hill:
In California, the average state and local taxes deduction exceeds $18,000, and among higher-income Californians that figure jumps to more than $64,000. In New York the number is more than $84,000.
Already in the Golden State, two Republican-held seats are leaning Democratic, another three are toss-ups, and two more are merely leaning Republican. In New York, a similar story emerges. There, two Republican districts are regarded as toss-ups, and a third seat held by an incumbent Republican is only leaning red.
Although the Democrats’ progressive wing may have little sympathy for tony suburbia, they have unvarnished antipathy for Wall Street and the Fortune 500, and that’s how coalitions are built. In that vein, money center banks have emerged as the big winners under the tax bill.
Last week, Citigroup reported that first-quarter profits rose by 13 percent from a year earlier, with a reported a profit of $4.62 billion, or $1.68 a share. Oh, and much of those newly found profits stemmed from the tax law.
By anyone’s calculation that’s a lot of money, and in some quarters much reason to be grateful. But elsewhere, the new tax law has folks gnashing their teeth as 2018 emerges as a year of tax hikes. For the GOP, that’s far from ideal. For the Democrats, it’s an opportunity.