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House Republicans Hope to Cut Taxes Without Raising Deficits

House Republicans Hope to Cut Taxes Without Raising Deficits

Trump and House GOP each have a plan to overhaul the tax code.

Rep. Kevin Brady (R-TX) said the House Republicans hope to change the tax code without raising the deficits:

“We designed our blueprint to break even within the budget, considering that economic growth,” Rep. Kevin Brady (R., Texas), chairman of the House Ways and Means Committee, said at The Wall Street Journal’s CEO Council. If there are some deficits, he said he would accept them if the result was stronger growth.

They started working on a plan earlier this year and will make a tax overhaul a priority in 2017.

The Wall Street Journal reported:

The House plan would lower individual and corporate tax rates, limit some tax breaks and change the way the U.S. taxes multinational companies’ foreign operations.

The plan will be analyzed using what is known as dynamic scoring, under rules changed by Republicans when they took control of Congress. Dynamic scoring for tax cuts assumes that policy changes can spur economic growth and thus cover some of their own costs by creating new tax revenue.

The plan will be analyzed using what is known as dynamic scoring, under rules changed by Republicans when they took control of Congress. Dynamic scoring for tax cuts assumes that policy changes can spur economic growth and thus cover some of their own costs by creating new tax revenue.

Without “long-run deficits” the plan has a good opportunity to “avoid a Senate filibuster and forbid increasing future deficits.” However, Brady also said they would accept any increase in deficits “if accepted by stronger growth.”

Brady told the group that “his plan would reduce government revenue in the early years but then generate economic growth and revenue after that.”

The Wall Street Journal also noted the differences between President-elect Donald Trump’s plan and the House Republican plan:

Mr. Trump’s plan features a 15% corporate tax rate, while the House plan sets it at 20%. Both are big cuts from today’s 35% rate.

Mr. Trump’s plan would lose at least $4 trillion in revenue over a decade without accounting for economic growth. Even his campaign didn’t suggest that the tax cuts alone would pay for themselves.

Mr. Brady said he thought gaps between the proposed rates could be bridged.

“Yes, I think we can find common ground on the rate, but I don’t think the rate’s enough,” Mr. Brady said, pointing to changes on capital expensing and international tax policies that he says would encourage economic growth.

But the plan faces opposition from both parties in the Senate. The GOP in the upper house have not agreed to either plan and may “alter it as the tax rewrite moves through the legislative process.”

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Comments

I was hoping to hear about cutting the budget some. It is fine to talk revenue, but the excesses in spending need to be addressed.

    Yup. Tax cuts are needed, and I approve. But it’s hard not the be cynical and wonder if this is just the GOPe working hard for the Donor Class.

    snopercod in reply to mrtomsr. | November 16, 2016 at 8:18 pm

    The House is of to a bad start on the budget. Yesterday they passed a 1 cent federal tax on concrete blocks. Read it yourself: H.R. 985, the Concrete Masonry Products, Research, Education, and Promotion Act of 2015

That’s the small end of the worm. The easy part. Now… if everyone will look to the right… follow the spine of the critter… see how it snakes back to that huge warehouse? That’s the working end of this Kraken – Omnibus Spending Bills.

The GOP has full control of the House. And yet, they continue to roll up hundreds of spending bills into one Behemoth that can only be passed or opposed in toto.

It’s cowardice. Because it protects Congress from being accountable to the voters. Let tax payer funding of Planned Parenthood stand because you don’t want to be accused of shutting down national parks. And hey, lets all roll our perspective pork-barrel spending together – you vote for my slush fund, I’ll vote for yours.

No. This has to stop. Spending bills should be voted up/down on an individual basis. Hell, the current Omnibus Kracken is so huge, I doubt anyone has even read them before passing them.

    Milhouse in reply to Fen. | November 16, 2016 at 4:18 pm

    No, it’s not cowardice. They tried passing individual appropriations and Reid wouldn’t let them through the senate. If they got through the senate 0bama would veto them. So they ran out of time and passed an omnibus.

      Old0311 in reply to Milhouse. | November 16, 2016 at 4:28 pm

      So they would rather act the fool rather than letting Reid or Obama be the bad guy? Wow! That was so unsmart!

        Milhouse in reply to Old0311. | November 16, 2016 at 7:00 pm

        Neither Reid nor 0bama would be the bad guys. If the government shuts down, it’s always the Republicans’ fault, no matter who plays which of the roles in the process. If a R president vetoes a budget Congress sent him, it’s his fault. If a D president does the same, it’s Congress’s fault. If the senate refuses to even consider the budget bills the House sends it, it’s the House’s fault — except, of course, when the Ds control the House and the Rs the senate.

        Were you asleep the last few times we played this game? Compare ’87 to ’95; what was the difference in circumstance that caused the two events to be reported differently, and therefore remembered differently to this day?

        The bottom line is that when the senate refuses to pass the house’s budget bills, there’s nothing the house can do about it. a budget must be passed regardless. So if the only one the senate or president will agree to is an omnibus bill the house has no choice but to pass one.

          Barry in reply to Milhouse. | November 16, 2016 at 9:28 pm

          “If the government shuts down, it’s always the Republicans’ fault, no matter who plays which of the roles in the process.”

          Only because of the lack of spine in republicans. That may be about to change.

          Milhouse in reply to Milhouse. | November 16, 2016 at 10:50 pm

          It’s got nothing to do with lack of spine. There is nothing Republicans can do to change the fact that government shutdowns are always their fault. Neither in ’87 nor in ’95 did they lack spine, and the only difference between those two cases was that the party roles were reversed, and yet somehow that one difference caused the blame to shift; thus the only possible conclusion is that the blame belongs on whichever side the Republicans are on.

      “If they got through the senate 0bama would veto them.”

      What Ace defines as Failure Theater:

      “March 03, 2015 – As Expected, John Boehner Sells Out the Conservatives In Yet Another Performance of “Failure Theater”
      Failure Theater is the process by which the Establishment deliberately fails to do achieve anything, but wants credit from the Dumb Conservatives they’re playing to for allegedly “trying.”

      Each of Boehner’s and McConnell’s “defeats” are in fact planned in advance. They are not trying to advance the conservative agenda; they are attempting to con conservatives into believing they have attempted to implement conservative policy, when in fact they were delivering their political deliverables to their Donor Class paymasters all along.

      Uneducated, gullible, and easily led: if we stand for this, we are exactly what the Washington Post slurred us as 30 years ago.”

      http://ace.mu.nu/archives/355300.php

      We need to stop falling for this. We want our Leadership to fight for us, stop caving, make the other side defend. Shape the battlespace, because an Obama veto commits the other side and fixes them in place.

      You are not expected to slay the Dragon. But you are expected to try.

      ConradCA in reply to Milhouse. | November 17, 2016 at 12:24 am

      Spending bills can’t be blocked by a filibuster. That’s how the progressive fascists rammed obamacare thru without 2/3 majority.

Correct me if I’m wrong, but I seem to remember reading (charts and graphs) that every time there were tax cuts, revenue also ticked up and continued to rise. The problem seemed to be that the government also increased spending beyond the increased revenue uptick. Like Regan said, “we don’t have a revenue problem, we have a spending problem”

Sarge

    Milhouse in reply to AFSarge. | November 16, 2016 at 4:19 pm

    That’s what dynamic scoring is about. The Dems imposed static scoring, which assumes that economic activity will not change, and therefore a rate cut must mean a revenue cut.

“The GOP in the upper house have not agreed to either plan and may alter it as the tax rewrite moves through the legislative process.”

For starters, can we stop calling the Senate the “upper” house? 😉

Pretty sure the voters in Michigan and Penn just sent a loud message about taking direction from the more educated elites. I know, one purpose of a Senate is to serve as a bulwork against any irrationality supported by the people (House), but the Senate has morphed into something else.

[sigh] I really wish we could replace McConnell. I see him as the enemy of reform.

This is all just dicking around the margins.

The Code needs to be burned to the ground and the roots torn out.

We need a new tax system that is not a affront the idea of “free people”, not some tinkering.

PR Hack – if you are a Republican Speaker of the House, you better not look like Boehner did, looking like you just came back from Christmas Vacation. $300 haircut, well-fed and rested up.

The Bernie look is your model. I want my Speaker to look haggard. I want him to look like he’s been sleeping on the office couch and surviving off of Ramen Noodle for 3 weeks. Because he has been busting his ass to serve the people that elected him.

Instead, we got Boehner, who always look like he had just spent the afternoon in Vegas tables with corporate lobbyists.

Congress is structurally unable to control its spending. And that’s when it’s working; even if all corruption, embezzlement, kickbacks, earmarks, etc were eliminated, it still couldn’t function without spending more money than it has available. It’s not just a matter of getting rid of thieves like Reid or Feinstein; it’s the way Congress works.

This is primarily because Congressmen in both Houses bribe each other with their votes. Congressman A promises to vote for Congressman B’s pet project on the understanding that B will vote for A’s.

Note that both pet projects, A’s and B’s, may be perfectly legitimate. A may have a think tank report (which he’s commissioned) which shows that the Navy should have a new aircraft carrier, and a shipyard in his state which may have to close otherwise could bid on it; and if it gets the contract, half the jobs at one end of his state will be preserved—a perfectly legitimate concern for a Representative or Senator, and there’s nothing corrupt or underhanded about it. But nobody else in Congress cares about it; hell, it’s not in their states, so it’s just a waste of money. Somehow he has to whip up the votes. Ditto for B; his project will be of vital interest to his constituency or state, and it’s his job to make it happen.

Since both A and B need the votes, they get them from each other via … what, “vote bribery”? So, since both projects involve spending money, there is no way to conduct Congressional business without spending money … and lots of it.

The only way to handle this situation is with a draconian balanced-budget requirement. But that would require some supreme authority to axe the overspending; and there would be intense fighting over it. Even if an external authority, such as the President, did the job, vetoing anything which looked too expensive, they’d find ways to hide it, just as the Feds do today with perpetually embarrassing expenses like the Post Office. They dismiss concerns with the glib assurance that those things have been moved “off budget”, as if that makes them go away.

If you look at the actual figures for federal external debt (internal debt is something else) vs. revenue, it’s clear that the last time the federal government took in more money than it spent was 1957. This problem has been a long time a-festering.

“We need to stop falling for this. We want our Leadership to fight for us, stop caving, make the other side defend. Shape the battlespace, because an Obama veto commits the other side and fixes them in place.”

I meant to elaborate on this.

I’m thinking of all the sports games where a team is backed into a corner but keeps slugging it out, and how just TRYING has opened up opportunities to exploit. Time and time again.

Assistant: Deon Sanders. OMG he will knock down every pass we throw to his zone. He effectively shuts down half the field. Guess we have to abandon our passing game and just run the ball.

Coach: No. We’re going to test him

Post Game: Deon Sanders Out For Season. “After a brilliant performance, including an interception, Cornerback Deon Sanders was jumping for his 2nd when he hyper-extended his knee. Dallas went on to lose 35-10, the last 2 touchdowns exploiting the rookie who replace Sanders.”

Coach: See? Not only did we win, Deon is off the playing field next time we meet. We won’t see him in the playoffs

I mean come on. Trump JUST did this. Or is campaign manager did Have we already forgotten? It’s only been a week.

Who predicted that just by testing conventional wisdom, the Democrat party would be imploding. Maybe for a generation? Did anyone see that coming? Please name one, and maybe ask him for lotto numbers too.

Look at all the opportunities that opened up as a result. In the Marines, by unit’s logo was “Victory to the Bold!” which I always thought was lame. But it applies here. Be bold. Hell, if only because caving predisposes you to cave more often.

Our problem lies with the House of Representatives. Our first House had one representative for every 30,000 citizens. Currently each house member now represents 700,000 citizens on average.

There is no way any one person can represent the interests of 700,000 people; small business, families, big business, lawyers, bakers, farmers, cattlemen, etc, will all lose to the lobbyists hired by deepest pockets. A congressman can anger half his voters and still win reelection. So we know which folks the congressmen will please.

Instead of 435 highly paid, well pensioned members of an exclusive club, we need at least 10,000 house members to truly represent the diverse interests of all our citizens. We should build a barracks with an integral cafeteria where subsidized meals are served to reduce costs. There should be no pension for service in either the Senate or the House, travel expenses should be trimmed to the bone; say three paid trips to the home district every year.

The benefits of such a scheme would be enormous; the costs of those seeking to influence legislation would skyrocket while the success of such efforts would fall dramatically. Most ‘pork’ legislation wouldn’t get to first base with a house this large. Special interests simply would not be able to dominate the legislature as it does today.

If finding candidates to serve under such onerous conditions, we could institute a draft among registered voters and require those draftees to serve for two years. To reduce the hardship of such a tour of duty, we could require employers to hold their jobs for them upon their return.

Take the House out of the hands of big government and return it to the people; change you can believe in.

    mrtomsr in reply to MSO. | November 16, 2016 at 6:31 pm

    Maybe all of the Congress critters should be based exclusively in their home districts. All work and votes should be telecommuted to the capital. This would make it more difficult for any lobbyist to purchase a lot of them, and make the critter more susceptible and available to their constituents.

    Milhouse in reply to MSO. | November 16, 2016 at 7:16 pm

    the costs of those seeking to influence legislation would skyrocket while the success of such efforts would fall dramatically.

    How is an uninformed legislature a good thing? Driving up the cost of informing legislators is a scheme for first ensuring that only the very rich can do so. The inevitable next step is for poorer folk who desperately need to influence legislation to band together, “bundling” their interests and lobbying for all of them at once, thus making the problem you seek to address even worse.

    Milhouse in reply to MSO. | November 16, 2016 at 7:32 pm

    L Neil Smith suggested abolishing congressional elections altogether, and have congressmen be the proxy-holders of the people they represent. Each citizen gives his proxy to a representative he trusts, and pays that person whatever he charges for this service. Some charge a lot but give personal service to a small clientele; some charge little and make it up on volume. Citizens may shift their proxies to someone else at any time, for a small fee to discourage people doing it twice a day for no good reason. Representatives who hold at least 100,000 proxies have the right to speak in debate. Others get their point across to their colleagues in private, acting more as lobbyists than as congressmen, though of course they do cast whatever proxies they have.

Tyrant Obama the Liar increased spending by 25% in one year and that should be what we cut first. Then kill all the subsidies for green energy and everything spent on ObamaCare.

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