All taxes are not created equal. Some benefit average people. Some benefit Wall Street and the wealthy.So pay close attention to which taxes are under discussion for being cut.
Cutting these taxes benefit the 99% (you and me):
* Sales taxes
* Fees, tolls, licenses, fines, etc.
* Sin taxes (alcohol, tobacco, etc.)
* Payroll taxes (Social Security)
* Property taxes
These are all regressive taxes.
Cutting these taxes benefit the 1%:
* Capital gains tax
* Estate taxes
* Luxury taxes
* Corporate income taxes
* Personal income taxes
These are progressive taxes.
Akadjian has details on why each tax benefits the regular people or the rich. Shifting the tax burden and benefiting the rich is easy. Declare a cut on the income taxes. Everybody pays these, so most go along with the idea. Then, oops, a budget deficit is looming. This could be at the federal level, or because the federal grants to states were cut, or because state grants to cities were cut (as has been going on in Michigan for 25 years). Taxes need to be raised. But it is usually the regressive taxes that go up (which are usually the taxes a city can raise).
Back in 1978 Jude Wanniski proposed a plan to raise stock prices. In 1921-1929 there was a five-fold increase and stock price. Wanniski proposed we do it again. Never mind what happened to stock prices in October of 1929 and the American economy in the next decade. Wanniski's ideas became the core of Reagan's supply-side economics.
I listen to an economics show on NPR when I can. One thing this show repeats whenever the stock market has big gains or losses is: The stock market is not the economy and the economy is not the stock market. Akadjian elaborates:
[Wanniski's plan] doesn’t boost demand. It doesn’t create jobs. It doesn’t help the middle class. As Wanniski points out, these tax cuts benefit wealthy investors and juice the stock market.And we get suckered because too many people can be led to believe that a rising stock market means a healthy economy.
Akadjian reviews all the tax cuts and increases over the last 40 years (about the time Wanniski presented his plan). He also keeps score. In those 40 years the new tax law benefited the 1 percent 22 times and benefited everyone else 6 times.
Both Trump and Cruz proposed reforming that tax system. Want to guess who would benefit?
We’re told that the 1 percent will invest and create more jobs. Anyone who’s taken even the most basic business courses knows that you hire people when there’s an increase in demand. Taking money from consumers (70 percent of GDP spending) reduces demand.