Republicans have both an arithmetic and a messaging problem as they try to enact Donald Trump’s second-term agenda via a giant budget-reconciliation bill. The former involves finding a way to pay for the $4 trillion-plus tax cuts Trump has demanded, along with a half-trillion or so in border security and defense spending increases. And the latter flows from the necessity of hammering popular federal programs (especially Medicaid) to avoid boosting budget deficits that are already out of control from the perspective of conservatives. This sets up Democrats nicely to deplore the whole mess as a matter of “cutting Medicaid to pay for tax cuts for Trump’s billionaire friends,” a very effective message that has vulnerable House Republicans worried.
To interrupt this line of attack while making the overall agenda slightly more affordable, anonymous White House sources lofted a trial balloon earlier this month via a Fox News report:
“White House aides are quietly floating a proposal within the House GOP that would raise the tax rate for people making more than $1 million to 40%, two sources familiar with discussions told Fox News Digital, to offset the cost of eliminating taxes on overtime pay, tipped wages, and retirees’ Social Security.
“The sources stressed the discussions were only preliminary, and the plan is one of many being talked about as congressional Republicans work on advancing President Donald Trump’s agenda via the budget reconciliation process.
“Trump and his White House have not yet taken a position on the matter, but the idea is being looked at by his aides and staff on Capitol Hill.”
The idea wasn’t as shocking as it might seem. Trump’s 2017 tax cuts reduced the top income-tax rate from 39.6 percent to 37 percent, so just letting that provision expire would accomplish the near-40 percent rate without disturbing other goodies for rich people in the 2017 bill like corporate-tax cuts, estate-tax cuts, and a relaxed alternative minimum tax for both individuals and corporations. One House Republican, Pennsylvania’s Dan Meuser, suggested resetting the top individual tax rate at 38.6 percent, still a reduction from pre-2017 levels but a “tax increase on the rich” as compared to current policies.
Crafty as this approach might have been as a way of boosting claims that Trump had aligned the GOP with middle-class voters (the intended beneficiaries of his recent tax-cut proposals) rather than the very rich, the idea of backing any tax increase on the allegedly super-productive job creators at the top of the economic pyramid struck many Republicans as the worst imaginable heresy. You could plausibly argue that total opposition to higher taxes, or even to progressive taxes, was the holy grail for the party, more foundational than any other principle and one of the remaining links between pre-Trump and MAGA conservatism. At the very idea of fuzzing up the tax-cut gospel, old GOP warhorses like Newt Gingrich and Americans for Tax Reform’s Grover Norquist arose from their political rest homes to shout: unclean! Gingrich called it the worst potential betrayal of the Cause since George H.W. Bush cut a bipartisan deficit-reduction deal in 1990 that included a tax increase.
As it happens, it was all a mirage. In virtual unison, both Trump and House Speaker Mike Johnson have said a high-end tax cut won’t happen this year, as Politico reports:
“President Donald Trump and House Speaker Mike Johnson on Wednesday came out against a tax hike on the wealthiest Americans — likely putting the nail in the coffin of the idea.
“Trump told reporters in the Oval Office that he thought the idea would be ‘very disruptive’ because it would prompt wealthy people to leave the country. …
“Johnson separately knocked the idea earlier in the day, saying that he is ‘not in favor of raising the tax rates because our party is the group that stands against that traditionally.’”
Trump’s real fear may be that wealthy people would leave the GOP rather than the country. Many are already upset about Trump’s 19th-century protectionist tariff agenda and its effects on the investor class. Subordinating the tax-cut gospel to other MAGA goals might push some of them over the edge. As for Johnson, the Speaker is having to cope with the eternal grumbling of the House Freedom Caucus, where domestic budget cuts are considered a delightful thing in itself and the idea of boosting anyone’s taxes to succor the parasites receiving Medicaid benefits is horrifying.
If Trump’s “big, beautiful” reconciliation bill runs into trouble or if Democrats set the table for a big midterm comeback wielding the “cutting Medicaid to give billionaires a tax break” message, squashing the symbolic gesture of a small boost in federal income-tax rates for the wealthy may be viewed in retrospect as a lost opportunity for the GOP. For the time being, that party’s bond with America’s oligarchs and their would-be imitators stands intact.
Yes, we have to overwhelm them with a landslide and GOTV will be crucial. But I was getting at what Susan picked up. We need to weigh in on the spin game, and hard. First, we have to shout that Kerry did win, and support all efforts of the Kerry campaign to make sure the votes are counted. And we have to have a good narrative about why Bush lost. We have to create our own facts, starting now.
Alan S,
You are absolutely correct.
The Bush Machine is all about saying something and making it so by saying it over and over and over.
Fox News and Gallup are in on it. So is the New York Post, the Washington Times, and Drudge. Likewise Limbaugh.
They take daily talking points and utilize brainwashing techniques aka marketing techniques.
They are losing because their product sucks so hard. People try Kerry Cola, and even though the marketing sucks, it tastes better.
Bush and team already plan to either declare victory or war the night of November 2nd. Unless there is a landslide, this guy is not leaving office without a fight. I can easily see him counting on litigation or legislatures to steal a few key states.
That is the main reason we need to win by 5 million or more votes. We need a landslide to rid the country of this counterfeit King who stole the presidency once, and will surely do so again if given any chance.
Danton wrote:
“Are there circumstances in which the “50% rule” doesn’t quite hold? Could, say, the majority of undecided voters break for an incumbent in a time of war?”
=================================
What time of war?
The public doesn’t perceive this as a US war, but as a Bush war, and there has been no indication the undecideds are in any way moved by Bush’s constant pitch that this is a war time.
If they would buy that dubious proposition, they would have bought it already.
All polls shows undecideds decidedly anti-war.
Ruy, echoing “Gabby Hayes,” I was very happy to see you get props from Krugman, who’s one of my idols.
But I share Alan’s concern about the guerilla campaign that Bush/Cheney are waging. My advice: volunteer NOW to get out the vote and do what you can to help the Dems keep voter fraud at bay.
Alan, We certainly made a difference right after each debate when we flooded the polls with votes stating that Kerry won. Hope we can be effectively mobilized to help bring about victory on Nov. 2.
At the moment, I’m on pins and needles. My DD and Ruy make me feel hopeful, then I read Altercation and Eric reports that things just ain’t that rosy.
Oyi!
Krugman’s article is important because it says it out loud that we are in an evolving coup d’etat. And it reinforces the picture of Bush’s world painted by Ron Suskind in his important NY Times article
Krugman’s point about Gallup illustrates perfectly what the Bush advisor meant when he told Suskind that “we create our own reality.” This remark has nothing to do with faith vs secular, it is ad-speak. I’ve been around advertising types for years, and it is how they speak. They do create perceptions, and for them, that is reality.
Gallup, Fox, and the others are working very hard to create the perception that Bush is winning. They are not obsessed, like those in the reality-based community with analyzing facts as they exist. They are creating perceptions–reality in the world of politics. And as the Bush adviser told Suskind, the rest of us just have to rush to catch up.
While the rest of us are glued to TV on election night, analyzing the election results, the right wing media machine will be forging ahead, creating the perception that Bush has already won. We’ve all got to do what we can to create the alternative perception, that Bush lost and Kerry won. Let’s not be caught flat-footed this time around.
Are there circumstances in which the “50% rule” doesn’t quite hold? Could, say, the majority of undecided voters break for an incumbent in a time of war? I ask this because lots of blogs seem to take the rule as an article of faith
Ruy, you didn’t mention that he gave you a shout out and props by name.
I was reading Krugman earlier today and saw the tip of the hat he gave you on deconstructing Gallup and others.
Congrats. I’ve been sending people here for the past 6 weeks to get people educated on polls.