Tax cuts

Robert Reich
10-9-2017

The Time’s David Leonhardt today warns Gary Cohn (head of Trump’s National Economic Council) and Steven Mnuchin (Treasury Secretary) that they risk their career reputations by telling two big tax lies:

1. “Wealthy Americans are not getting a tax cut,” said Cohn on “Good Morning America,” echoing Mnuchin’s promise that “there will be no absolute tax cut for the upper class.” Baloney. The Trump-Republican tax plan is reducing the top income-tax rate from 39.6 percent to 35 percent; cutting corporate taxes, which benefits the rich, who own most stock; allowing hedge-fund, private equity, and real estate partners (Trump and Kushner) to pay the pass-through rate of 25 percent; and eliminating eliminating the estate tax altogether. In other words: A huge windfall for the rich.

2. “This tax plan will cut down the deficits by a trillion dollars,” Mnuchin said, while Cohn claimed “we can pay for the entire tax cut through growth.” Rubbish. The Reagan and George W. Bush tax cuts exploded the federal deficit. Trickle-down economics is pure hokem.

But I’m not sure I agree with Leonhardt that these two alumni of Goldman Sachs risk their career reputations on these two whoppers. Their behavior at Goldman Sachs leading up to, and during, the 2008 meltdown was quite adequate.

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