By Bob Livingston
The “nonpartisan” Congressional Research Service is fake news
Last month the “nonpartisan” Congressional Research Service (CRS) released its preliminary analysis of the economic effects of the Trump tax cuts, also known as the 2017 Tax Cuts and Jobs Act (TCJA). The service’s findings prompted orgiastic convulsions among the left-wing pundits with its finding that tax cuts had little impact on the economy.
In reporting on the CRS analysis, the George Soros-funded socialist propaganda website Thinkprogress claimed, “Sorry, America’s middle class: President Donald Trump’s signature tax code overhaul has not generated any meaningful new economic growth that wasn’t already underway, the nonpartisan Congressional Research Service (CRS) has found.”
It continued with, “Large corporations with shiny accounting departments ended up being the largest beneficiaries of the tax bill’s largesse, with the rate of tax they actually pay dropping by half in 2018, according to the CRS analysis. But the vanishingly insignificant comparative break Trump’s law gave workaday people lays the game bare.”
Not to be outdone, New York magazine proclaimed, “The biggest effect of the Trump tax cuts is obvious: People who own businesses and other sources of concentrated wealth will have a lot more money, and the federal budget will have less. But the advocates of the tax cuts insisted it wasn’t about letting the makers keep their hard-earned money rather than handing it over to the takers. It was about incentivizing business to repatriate funds and ramp up its investments, thereby increasing growth and wages.”
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People holding onto their money is quite troublesome to progressives. They think “People who own businesses and other sources of concentrated wealth” keeping more of their own money is bad, especially if it means “the federal budget will have less.”
Our take, of course, is that everyone should be allowed to keep more of their money — rich and poor. But then, we believe in liberty and that taxation is theft and that people know better how to spend their money than do cubicle-dwelling government functionaries and corrupt politicians.
To reach its conclusion that so pleased the wealth redistributionists, CRS had to engage in some mathematical hocus-pocus, sophistry and outright argle-bargle. Among its bogus claims is that 2.9 percent gross domestic product (GDB) growth was not significant — even though it exceeded the Congressional Budget Office’s projected 2.0 percent by almost a full percentage point — because it wasn’t more than the 2.9 percent mark in 2015. It also argued that benefits didn’t come from an expected influx of corporate profits that were parked offshore, (I note it failed to mention the reason the money was parked offshore to begin with was to avoid the confiscatory nature of the previous tax code, but I digress) and that wages didn’t rise.
But the proof is in the pudding, and you can find it if you want to slog through the nonsense of the report. American workers got an income tax break. Even Thinkprogress had to grudgingly admit that two out of every three taxpayers “owed the government less this tax year than they had prior to the new tax law.”
The tax break came in the form of lowered tax rates that resulted in bigger paychecks, even though actual per hour wages didn’t go up significantly. They got it when they filed their taxes, although many Americans have been so propagandized about filing their taxes, thinking that income tax refunds are a gift from government, they didn’t realize that smaller income tax refunds at tax time meant they “owed” and had paid less in taxes than previous years.
Tax breaks also came in the form of lowered cost of goods and services — or, at least, slowed inflation. That’s because corporations don’t pay taxes. They are pass-through agencies, which means money passes through their hands from customers — who actually pay the taxes — to the government. You see, the cost of any taxes “owed” by corporations is figured into their costs for doing business and reflected in the price you pay for the good or service you’re purchasing.
The leftist media class claim that corporations pouring their profits back into the stock market through stock buybacks is not helpful to the middle class. As Thinkprogress lamented, “So what happened to the other 97 percent of the money corporate accountants were handed by the government? A trillion dollars of it went to shareholders, as the law triggered a record wave of stock buybacks — an unproductive back-scratching activity that keeps the money firmly ensconced in upper-class hands that have little reason to spend that new cash back into the economy where working stiffs make their living.”
Well that’s downright fake news. Everyone who owns stocks, a mutual fund or stock-centered individual retirement account or 401(k) benefits when the market rises.
It’s not surprising, however, that the “nonpartisan” CRS would issue such a slanted (phony) report. That’s because calling the CRS “nonpartisan” is also fake news. As Issues & Insights notes, during the last election cycle researchers and employees at the “nonpartisan” CRS gave $10,000 in campaign contributions Democrat candidates and left-wing political action committees. But only $650 went to Republican candidates, and all that from only one CRS employee who contributed to Senator Pat Toomey’s and Senator Kelly Ayotte’s campaigns.
And if you need more evidence that the Trump tax cuts provided tax relief for the middle class, look at what The Hill slipped up and said in an unrelated article discussing Joe Biden’s presidential prospects:
Joe Biden opened his much hyped 2020 presidential campaign last month by proclaiming the “first thing” he would do if elected is to repeal the Tax Cuts and Jobs Act. That means the middle class would see a tax increase.
Oops.
