Elsewhere I have posted and tweeted that the Tax reform bill promoted by Republicans in Congress isn’t at all the big deal its friends — or its opponents — say it is. The numbers that will result end up about the same for most taxpayers; what changes, big time, are the routes by which those numbers are arrived at. (Some taxpayers will see significant change. Very low income householders drop off the tax rolls entirely, and if they have children, can get a Child Tax Credit refund up to $ 1400.00.)
I’ll get to the Tax bill itself later. First, however, I want to alert you to what really IS major about the Tax bill : the Congress’s vote.
No Democrats voted for the bill, and, in the House, only 12 Republicans said no. None said no in the Senate (John McCain did not vote. He is in Arizona trying to recover from the effects of his chemotherapy.) Instead, the Democrats cried holy hell against the Tax bill, taking a worst case scenario of its outcome as their rally cry, and distorting, even mistaking, some of its provisions.
This was the exact same outcome as in 2009, when the ACA health care reform was passed with not a single Republican vote, after which the Republicans spent seven years decrying it, distorting its provisions, and misstating many of them.
In our Constitutional system, the Congress represents the wishes of voters back home; members must exercise, individually, their own judgment about legislation. That was, after all, the model that actually existed in Great Britain, where the then unreformed House of Commons (and the House of Lords) more often than reflected the consensus of individual members acted on their own deliberation. Granted, that in England during the Napoleonic Wars and thereafter, and in our own Congress from time to time, partisan sentiment has outweighed individual conscience. The surest situation for overriding partisan decision was for Congress (Parliament too) to reflect a large number of discrete interest groups, none a majority, so that no legislation at all could be enacted without coalition and compromise. Still in Parliament, the hardening of party rules — and the near extinction of all parties but two — has led to absolute rule by a majority chosen by voters who vote for the party, not the candidate.
Our legislature did not take that route, because the fact of 50 states, each with its own locally elected power structure, kept our two parties from hardening into a uniform orthodoxy. Senators, especially, voted their state’s interest, which forced the body to pursue coalition: and coalition always means compromise.
How, then, has our national legislature become parliamentary, a place where party overrides every other consideration ? The answer is simple : the Citizens United Supreme Court decision did it.
Today, hundreds of millions of dollars, even billions, go into Congressional elections. Senate elections cost $ 20 million and more; even Congress races require $ 2 million and up; many cost $ 10 million. Some Senate elections require $ 50 million. The donors who pony up that sort of money don’t care about state particularities. they want uniform national policies, and as their money absolutely controls the stuff that campaigns can do and say, when it comes time for the people that their money has elected to legislate, they legislate what the donors want, not what their state may happen to prefer.
I have overstated the case, of course: but not by much. State particularities still count — Congress people from New York and New Jersey voted NO on the Tax Bill because its $ 10,000 per year cap on the state and local tax (“SALT”) deduction prejudices homeowners in these very high house value states; and Maine’s Republican Senator, Susan Collins, only agreed to the tax reform when it included at least some SALT deduction as well as child tax credit (“CTC”) relief for her state’s large number of very low income families. Still, these examples prove the current rule : legislation in Congress is now accomplished by donor-united parties, not by coalitions of various interests.
The consequences of our Congress becoming a parliament are still difficult to forecast, but I doubt they will be small. As long as one party controls both houses of Congress and the Presidency, legislation can be enacted, albeit with utter opposition from the other party and inevitable gross distortions of its provisions, leading perhaps to that opposition party winning total control at a next election, at which point said legislation gets repealed.
This is government as ping pong. I can’t imagine much that is more damaging to the effectiveness of our Constitution.
Except for this : what happens when one party does NOT control both houses of Congress AND the Presidency ? We have already seen it, in the sessions of 2011 to 2016 : nothing gets done. Sometimes the government even gets shut down, at huge cost to Federal employees and to the orderly process of administration. The only check upon such lawlessness is the need that donors have to run their businesses: shut downs disrupt business stability.
The obvious remedy for ping pong government is to ( 1 ) repeal the Citizens United decision and bar corporate and LLC money from engaging in campaign politics; and ( 2 ) severely regulate the influence of special interest lobbyists, most of whom represent the big donors and the industries whence they operate. Can either of these solutions happen ? I doubt it. I’ve tried for years, unsuccessfully, to devise a legal rule that would reverse Citizens United without crippling the First Amendment’s protection of freedom of speech. Congress could overturn the decision; but as donors control all of it, it will never do so.
Welcome to the parliamentary, partisan America our founders wanted no part of and warned against.
As for the tax bill itself, it’s clearly the best that a one-party, parliamentary bill can get to, but that leaves the nation very short of what could be.
The bill offers some noticeable tax relief to very low income households, but that relief is mostly offset by repeal of the personal exemption — and is further nicked by repeal of the ACA individual mandate, which will raise health insurance costs for most. For every one else, a two percent tax benefit is on offer, but that relief is discounted by repeal of many deductions as well as a $ 750,000 cap on the deductability of mortgage interest. Nor is the corporate tax cut as huge as it reads, for many corporations don’t pay the current 35 percent stated rate, and the new 21 percent rate is linked to repeal of many of the deductions corporations have used to cut their tax bill. Then there’s the one-time “repatriation” tax on corporate funds brought back into the country from overseas.
All of the above, and more, is why my view of the tax bill is that after all the ink and outrage vented, and all of the utterly ludicrous talking points cannonading on both sides, it amounts to much ado about nothing. The big winners are the nation’s tax accountants.
—- Mike Freedberg / Here ad Sphere