Tax Reform Gets People Excited

Wall Street has been excited all week thinking about Trump’s tax proposals like I get excited about the NFL Draft.  They love the idea of a repatriation so they can bring all that boodle back to the states to sit on it here instead of there.

Theoretically, I have no problem with a 15% corporate tax rate.  So long as they’re getting rid of the thousands of pages of exemptions, loop holes and specific industry sweetheart deals that allow massive companies to pay little to zilch in taxes.  If GE paid 15% of its profits in taxes this year that would mean millions more in the coffers rather than the millions that they actually received back from us in a tax refund despite making billions in profits. Likewise, can we stop subsidies for some of the most successful businesses on Earth, that also pay no taxes?  I have no problem with all of that reform.

But if they were proposing that kind of reform so companies would actually pay more they wouldn’t be so excited, so I’m going back to bed.

Oh and the cutting the individual rates and eliminating brackets, that’s completely wrongheaded shit.

And getting rid of the Estate Tax is absolutely ridiculous, if anything the Trump family proves how necessary that is.  It was created after the Gilded Age as America had developed a generation of idle rich heirs and heiresses that alarmingly resembled a European-like landed gentry, living off trust funds and giving nothing back to society. Imagine the excesses of the worst rock stars, without the music.  The massive income suck up to the 1% of the last 30 years has created another generation much like that in the early 20th century.  So much money just sitting in bank accounts, passive investments or tied up in luxury goods does nothing for the economy; moreover, that generation represented what early 20th century leaders considered an un-American form of royalty that had to be disincentivized.  Funny, how we stopped thinking like that.

But the part of Trump’s plan that makes it absolutely awful, surprise, surprise, is expanding instead of eliminating the kind of tax give away like the hedge fund loophole. While saying on the stump that he’d end that, he’d actually expand it to other professions.

Beyond cutting the tax rate to 15 percent for large corporations, which now pay a rate of 35 percent, Mr. Trump also wants that rate for a broad range of firms known as pass-through entities — including hedge funds, real estate concerns like Mr. Trump’s and large partnerships — that currently pay taxes at individual rates, which top off at 39.6 percent.

 

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