In the wee hours of Saturday morning, Senate Republicans passed what could be one of the most important bills in recent history.
If it becomes law, it will revamp the national tax code, disrupt the national health care system, add trillions of dollars to the national debt and impact every pocketbook in America. So why did it pass just before 2 a.m., in the dark of night and with nary a public hearing?
Everybody knows that most 2 a.m. decisions are boneheaded, and something we regret in the morning light. So why are we passing important legislation at that hour?
It didn’t have to happen like this.
There is plenty to like about the tax bill. Reducing the corporate tax rate from 35 percent to 20 percent, a number in line with other first-world countries, is long overdue and will help American companies compete in a global marketplace. Most lawyer-heavy corporations were finding ways around the paying the 35 percent rate anyway — many by parking billions of dollars in offshore tax shelters — so perhaps the lower rate will actually increase tax receipts.
Yet there is plenty wrong with the bill, too. The tax code was crying out for simplification, modernization and real reform — things the GOP bluffed at tackling. They came up short.
The final Senate bill (and the House bill, for that matter) is deeply unpopular with voters. That is the most obvious reason why it was squeezed through in the dead of night.
The Trump tax cuts had a 48 percent disapproval rate and just 32 percent approval through much of November, making it the least popular tax cut in recent history, according to FiveThirtyEight. Yet those numbers are remarkably similar to Trump’s approval and disapproval ratings — and are probably more tied to the President himself than his tax bill because, again, nobody knew the details of the bill until the final hour.
Much of the disapproval rests on the fact that rich Republican donors and lobbyists seemed to get direct access to writing the bill, while middle-class voters (and elected Democrats) were left out.
The tax bill includes a tax break for people who own private airplanes. There is also a tax break for parents whose children attend private school.
While those clearly help upper-income Americans, they also hurt poor and middle-class homes. Cuts to state and local tax deductions will reduce funding to public schools, where most middle-class and poor Americans are educated, while private school parents now save a few extra dollars.
There is no economic rationale for this kind of thing. Rich Americans donated to the Republican Party, and the Republican Party is giving them what they want. It’s that simple.
We promised to keep you informed about the bill as it moved — at that we failed. How could we not? Not even the senators who voted on the 479-page bill, which included hand-written notes in the margins, knew what was in it more than a few hours before it was approved.
That’s problematic for democracy. But it’s also problematic for the law itself.
In the rush to pass the bill, the Senate GOP accidentally nullified many corporate deductions, among those most important to their corporate donors.
The Wall Street Journal reported that a research credit was forgotten, which could cost corporations up to $10.3 billion in tax write-offs.
That may get taken care of through reconciliation by the House and Senate, or by the hundreds of lobbyists who will sneak their wishes into the bill before it arrives at the president’s desk for a signature.
The American tax system is far from being broken, and far from being fixed. Tax policy swings back and forth with the pendulum of partisan control, and Republicans had their chance to create a more fair, open taxation system that lowered rates for many Americans.
On that, the Grand Ol’ Party fell short. And once they no longer hold the power in both houses of Congress and the White House, expect much of this tax plan to be rescinded.