Friday, December 22, 2017

Dems Should Proceed With Caution Regarding New Tax Law


I remember a particular episode early in my sales career that has stuck with me to this day. I had written a very large and, more to the point, lucrative sale – computer, printer, accessories, service contract – on a Thursday night right before I went home for the day. I had Friday off and didn’t have to go back in till noon on Saturday.

When I arrived, one of the senior salesmen took me aside and informed me that the sale I made Thursday had been returned Friday at another store. He could see I was deeply disturbed, so he gave me some very good advice: go downstairs to the warehouse, scream, punch the wall, whatever. Just get it out of my system, because there was nothing I could do about it. What’s done is done, he said. No sense bemoaning it.

So I went downstairs and sulked a bit. No, I didn’t punch the wall; my luck, I’d have broken my hand. But I did get it out of my system, as it were. Then I went back upstairs and had one of the best days of the month. Not only did I overcome the return I had, but I more than doubled what I normally did on a Saturday. That salesman did me a huge favor by taking me aside. He’d been down that road before and wanted to make sure I didn’t make the same mistake he had.

So, in the spirit of paying it forward, let me offer up a few pearls of wisdom for Democrats as they attempt to grapple with this new tax law (e.g., scam) that President Shitenstein just signed.

First, don’t compare this law with Obamacare. The two are totally different animals. While both were very unpopular when they were passed, the ACA wasn’t fully implemented for another two years. Most of the negative press it received was from conservative media outlets who just made up shit about it, and it only directly impacted a relatively small percentage of the population. This tax law will be felt almost immediately by the vast majority of working people.

Second, don’t underestimate the value an extra $40 can make in people’s lives. Already there are some Democrats that are poo-pooing the idea that some people will only get an extra forty bucks in their paychecks. This would be a colossal mistake. Like it or not, forty bucks is forty bucks. To some, it’s no big deal; to others, it’s the difference between a vacation or no vacation, buying some new clothes or making do with what they have, going out to dinner with the family once a month or having Chinese takeout. Democrats got bitch-slapped by the electorate in 2016 because of their arrogance; this is the sort of thing that can only reinforce that perception.

Even though the bulk of the individual tax-cut benefits go to the very wealthy, tax cuts are historically popular and almost always impossible to take away. Witness what happened to Democrats in the '94 midterms when Bill Clinton raised the rates on just the top two brackets. They lost their majority in both Houses of Congress.

Third, concentrate on the corporate tax cuts, which are completely indefensible. This is the one area where Democrats have an advantage over Republicans. They can and should make the case that the economy is doing quite well; profits are through the roof and we’ve had the longest stretch of sustained growth since the end of the Second World War. 

The problem is that wages haven’t kept pace with profits. There’s nothing in this tax law that compels businesses to invest in new factories, hire more people or give those in their employ pay raises. In fact, most experts agree that on balance the only thing these cuts will do is make investors’ portfolios a lot fatter. But so far as the average Joe or Jane are concerned, they get bupkis.

And lastly, don’t sit idly by and do nothing. Democrats can’t just criticize this law, they have to come up with one of their own and then they have to present it to voters. It doesn't matter that they don't have the ability to pass it; they must make the case that their vision is better than the Republicans. If they don’t or can’t, Democrats will find themselves in the same position Republicans were in trying to repeal a healthcare law they had no replacement for. And we all know how well that worked out.

Bottom line: Dems should proceed with caution regarding this new tax law, lest they end up making the GOP’s case for them. Even with the political headwinds at their backs, Democrats have had a history of fumbling the ball at the one-yard line. It would be inexcusable if they let this opportunity of a lifetime slip through their fingers because they sat on their asses and threw up their hands.

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