Late Thursday Congress passed a continuing resolution (CR) to keep the federal government open through December 22. Had it not been for the CR the government would have had to shut down at midnight last Friday. Normally when Congress does something like this pundits criticize them by saying they punted. In this case I’ll stick with a football analogy but I’m “throwing a flag” for delay of game. Let’s explore.
The CR is a clean bill. Meaning it is simply an extension with nothing resolved. Congress (with an assist of incompetency from the President) simply admitted it couldn’t “get its homework in on time” and granted itself an extension. The new deadline is Friday December 22nd. How would you like to have reported to work last Friday only to be told by your boss that the company may or may not be open past December 22, 2017?; so much for running the government like a business; a well-run one anyway.
Congress is far from an example of productivity and they are still dealing with the Trump Tower Tax Cut (more about that below) which the President wants to sign before Christmas. As is usual the Republicans needed Democratic votes to get the CR through the House. This time the Democrats gave them a free pass. In their rush to get out of town for the holidays will they do the same in about two weeks?
From her rhetoric, it appears Nancy Pelosi wants to make a resolution to DACA her line in the sand for support of the next CR. I like clean CR’s but extortion seems to be one of the few ways Democrats can get House Republicans to do what they should have already done. I didn’t like Trump’s DACA decree. He was standing (with much of his base) on xenophobia, not constitutional principle. That being said, Congress should have taken action on comprehensive immigration reform a long time ago. Where exactly to draw the lines is a matter best left for debate and compromise, but the principle is simple. These dreamers are more American than anything else! America is their country and they deserve the opportunity to come out of the shadows and contribute to society.
I’m somewhat hopeful that a reasonable resolution to the DACA challenge will be included in the December 22nd deal. If not, I expect another punt and a resolution to be part of an early 2018 deal. The problem is that in the interceding time period more people here legally under DACA are becoming illegal on a daily basis because their individual status has expired.
If you feel sympathy for the dreamers who suddenly become illegal based on the federal government’s incompetence, (and you should), I have a situation that is even worse. The CHIP’s (Children’s Health Insurance Program) program has not had its funding renewed and many states are about to or have run out of money leaving poor children in their state without health care. Leading Congressional Republicans keep making public statements that CHIPs funding will be renewed but the action has yet to occur. In some cases simultaneously they express concern about the cost of the program. Remember these are the same people who voted for the Trump Tower Tax Cut.
Thanks to Paul Krugman’s op-ed in Friday’s edition of the New York Times I have found the money. It is simply a matter of leaving the Estate Tax untouched in the final version of the Trump Tower Tax Cut. As things currently stand the estate Tax is estimated to bring $20 billion into the treasury next year. The estimated cost of CHIPs is $15 billion. By my plan (purloined from Dr. Krugman) CHIPs is paid for and the government has $5 billion in “change” left over.
Now let’s look at the benefit to the economy of the two plans. Under the Trump Tower Tax Cut we will give money to the beneficiaries of the 5,500 largest estates in America; (well within the 1 %.) In most cases those are people who already need a passport to visit their money and there is little reason to believe they will spend their unearned, inherited wealth thereby stimulating the economy.
Under the “Krugman/Marciniak Plan” 8.6 million children will be healthier which means they are much more likely to be higher earning and more productive adults who will consume more and pay more in taxes in the not that distant future. Which plan is better for the economy?
If you want to look at the morality of the two plans (Republicans can skip this paragraph – they would ignore it anyway), let’s look at the number of people immediately helped and disregard the economic impact. In order to benefit 8.6 million people the 5,500 families would have to have 156 members each. Without the benefit of further arithmetic, I rest my case.
Puerto Rico, while not a state, is part of the United States. Its people are American citizens. It is also one of the poorest areas of America. It faces a special set of economic challenges since it is an island remote to the mainland. One provision of the Trump Tower Tax Cut is a 20% excise tax to be levied on goods made or grown in Puerto Rico that are “exported” to the United States. (I have a problem with the use of the word “export” – how do you export something within America?) Remember this is to finance a giant tax break for people and corporations that don’t need the extra money in the first place.
With all our political news one of the events that has not received its fair share of ink and air time is the wildfire situation in California. Acres of land are burning and in the process thousands of middle class citizens are losing their homes. Under the current tax code the losses are tax deductible. Under the Trump Tower Tax Cut that provision goes away. That’s one hell of a Christmas present for a lot of Californians. Of course, California is a blue state; just the Republicans rubbing SALT into the wound. Pun intended which is why I capitalized salt.
Krugman has called the Trump Tower Tax Plan, “The biggest tax scam in history.” I don’t think the Democrats can stop it from becoming law – a family feud in the Republican Party is our only hope at this point – but they may be able to negotiate it into a somewhat less harmful form. If you are going to delay the game (and Democrats must share some of the blame) at least make something positive come out of it.
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