Special Bulletin. The Republican Tax Bill: An Interim Report From the Sausage Factory

RINOcracy.com will defer comment on the specific ingredients of the sausages being produced by Republicans in the House in the Senate. In the meantime, and for an overall perspective, we are publishing below the analysis by the Committee for a Responsible Federal Budget (CRFB) of the bill released by the Senate.

Senate Tax Plan is a Fatally Flawed Budget Buster

Senate GOP leaders yesterday unveiled their version of tax reform, which resembles the House’s bill but also differs in several significant ways. The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:

The current tax reform debate shows Congress just can’t seem to shake its addiction to debt. Although the Senate plan has fewer gimmicks than the House bill, it would add more to the debt after 2027. And although the Senate bill goes further than the House in cutting some tax breaks, it is less aggressive elsewhere.

Fundamentally, the Senate bill suffers from the same fatal flaw as the House bill – it tries to cut taxes by $1.5 trillion over the next decade with no plan to pay for these cuts. As recent dynamic scores have shown, there is no way economic growth can pay for more than a fraction of this cost. 

In fact, tax cuts that add to the debt do less to grow the economy than fiscally responsible reform and may even hurt economic growth over the long term.

It is frightening that so many members of Congress are willing to believe in fantasy economics based in no historical or mathematical reality.

If tax cuts paid for by debt are signed into law, Congress will have sent a massive, budget-busting tax bill to our children to pay, and it will result only in a short-term sugar high with little to no economic improvement over the long term. As the Senate marks up this bill, we encourage members to either propose some serious pay-fors or scale back the cost of the bill and reject any gimmicks that hide its true cost.

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The Committee’s line item comparison of the Senate and House bills can be found here

As indicated in a previous blog, the Committee for a Responsible Federal Budget is a lineal descendant of the Simpson-Bowles Commission and its Board of Directors is comprised of distinguished public servants from both the Republican and Democratic parties: 

Chairmen: Mitch Daniels Leon Panetta Timothy Penny

President: Maya MacGuineas

Directors: Barry Anderson  Erskine Bowles  Charles Bowsher  Kent Conrad  Dan Crippen  Vic Fazio  Bill Gradison, Jr.  William Hoagland  James Jones  Lou Kerrim Jim Kolbe  Dave McCurdy  James McIntyre, Jr.  David Minge  Paul O’Neill  June O’Neill  Marne Obernauer, Jr.  Robert Packwood  Rudolph G. Penner  Peter Peterson  Dr. Robert Reischauer  Dr. Alice Rivlin  Charles S. Robb  Alan Simpson  John Spratt  Charlie Stenholm  Eugene Steuerle  David Stockman  John Tanner  Tom Tauke  Paul Volcker  Carol Wait  Joseph Wright, Jr.

Biographies of the individual Directors can be found here.

2 thoughts on “Special Bulletin. The Republican Tax Bill: An Interim Report From the Sausage Factory

  • The so-called “tax reform” bills are being rushed through Congress without any hearings for obvious purpose of enacting major legislation during Trump’s first year in office.

    Last week’s Democratic Party sweep of
    virtually all down ballot races shows that Trump is a big liability for Republican office holders. Hasty enactment of bad tax legislation would only worsen their fate in next year’s mid-term elections.

  • The reference to Chancellor von Bismarck’s famous quote on laws and sausage is wonderfully and terribly apt. Congress is as deluded as the President on the issue of taxes and as mendacious. The whole lot of them should be ashamed, but that is assuming a level of self-awareness that appears to be absent in politicians who revel in alternative facts.

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