Letter to the Editor

Who really benefits from tax cuts?

Thursday, September 27, 2018

Dear Editor,

Every tax system creates winners and losers.

The 2017 Trump tax reform gave 83% of the tax cuts to the richest 1% of the people.

This number has not been challenged by the Congressional Budget Office (CBO), the General Accounting Office (GAO), the Internal Revenue Service (IRS), and the non-partisan Tax Foundation. The American population is 330 million people.

The 83% tax cut goes to 3,300,000, out of 330,000,000 people. The net result reduces the progressive nature of our tax system and increases our debt by one trillion dollars a year. Thus, tax revenue shrinks and more borrowed money is used to pay entitlement programs like Medicare, Medicaid, and Social Security.

This further increases the gap between the richest 1% and the rest of us. If President Trump truly wanted to help the middle class he would have permanently cut payroll taxes. Instead, he implemented loopholes like the pass-through, reduced capital gains tax, and retained the carried interest provision.

Corporations which are plush with cash borrow money and write-off the interest on their debt.

Meanwhile, these low-interest rates, punish the little people who hold their money in bank accounts and CDs. The Trump tax cuts follow two major tax cuts by the George W. Bush administration. Rather than investing money in research and development and job creation, corporations have rewarded stockholders and CEOs with stock buybacks, stock options, and increased dividends rather than wages increases.

Over 90% of stock is held by 10% of the American people and foreign corporations. American companies have shifted risk to their employees by moving from a system of defined benefits to one of defined contributions.

Rather than increasing wages, they are giving one-time bonuses. President Trump has attempted to replace affordable healthcare with bare bones minimum coverage plans which do not guarantee coverage of preconditions. This is how he plans to reduce the cost of healthcare.

Tax cuts which dramatically increase the national debt when there is already full employment are contrary to traditional economic theory. When interest rates go up the cost of financing the national debt goes up accordingly.

Tariffs on imported goods increase inflation. Inflation eats up the little guy's tax cuts. Your paycheck may be a little larger, but you will end up with less purchasing power and a lower standard of living.

Mr. Trump says “the best is yet to come.”

Is it?

Roger Green

Scottsbluff, Neb.

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  • Lots of good points Roger, however I must take issue with what you define as entitlements. These are actually insurance plans which we are given no choice but participate in. The 1 percent sees this money sitting there for the taking and will do whatever it takes to get that money, first and foremost they will use the method of divide and conquer by getting as many as possible to believe that those receiving these insurance benefits are “takers” and no longer givers. I started working over 40 years ago and don’t expect to ever see a dime of your so callled entitlements!

    -- Posted by nebraskamike on Mon, Oct 1, 2018, at 12:54 PM
  • Taxpayers. That's who benefit from tax cuts.

    -- Posted by Hugh Jassle on Mon, Oct 8, 2018, at 1:52 PM
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