Ralph Kenyon 2015-09-29
Donald Trump's proposed tax "plan" is more of the same duplicity the republicans have been selling for many decades. You can bet that Trump is not going to remove any of the tax "loopholes" that he took advantage of to acquire his billions. By lowering taxes to 15%, he is giving the lion's share of benefits to the richest. As mother always said, "Them that has, gets." The poorest people will get ZERO benefit from a tax reduction, because they already pay no taxes. You can't get back what you didn't pay (Republican policy). But the richest will get the most in both amount and percentage back. His tax plan is self serving, and it's not going to do what he and the Republicans have been preaching for decades.
Lowering the taxes does not create jobs or boost the economy. I researched the result of tax changes since Ronald Reagan. Tax cuts were followed by increased unemployment the next year, and tax increases were followed by decreased unemployment. Examples: Reagan cut the top rate from 69.25% to 50%, and unemployment rose by 2.2% creating a major recession. (I lost half my stock investment.) Clinton raised taxes and decreased unemployment, creating a booming economy, which also eliminated the deficit and produced a significant surplus. After that Bush cut the taxes, putting the budget back into the red with the biggest deficit ever. HOW CAN THIS HAPPEN when the Republicans say that Cutting taxes boosts the economy and raising taxes kills jobs?
The answer is SIMPLE. When taxes are raised, the rich look for tax deductions, the most lucrative of which are starting small businesses and hiring employees. The rich avoid taxes by investing in businesses and jobs - boosting the economy and creating jobs - WHEN TAXES ARE INCREASED! On the other side of the fence, when taxes are cut, the rich get free money, which they don't have to protect from taxation. They invest this windfall in financial instruments that grow their wealth by NOT putting the money into new business and employees, thus taking this money out of the economy. This slows the economy, causing jobs to be lost thus raising unemployment.
This pattern has been repeated since Reagan. I researched the tax changes and unemployment since Reagan's first cut, and the pattern was born out time and time again. Only massive stimulus packages, such as the Obama shovel ready jobs in the US had any effect on the pattern. Those jobs were directly created by government spending on infrastructure, so jobs were created in spite of the sequester, which only held tax and spend constant. But, the stimulus has created jobs and boosted the economy so much so that the deficit has been significantly cut. If we keep going, we will begin to generate a surplus - especially if we raise taxes on the rich, and force them to invest in business and labor. If we CUT taxes, as Trump and the Republicans want, It will undo the last 8 years of growth and take us back to the Bush and Republican induced Recession.
If Trump wants to make America great again he will have to raise taxes. The rich looking for ways to avoid paying taxes will invest in new businesses and the employees creating jobs and boosting the economy. But it won't happen if they get a tax cut, they will simply invest in financial instruments that will grow their wealth, taking money out of the economy.