Within a week, Republicans will probably pass a corporate tax cut that is one of the most unpopular major pieces of legislation in modern American history. This is a rather curious distinction for a bill that cuts taxes for nearly every American family.
How can a trillion-dollar tax cut be so unpopular?
One possibility is that Americans don’t like the bill because they don’t understand what it does. More than half of Americans don’t think that the Republicans’ bill will reduce their taxes in 2018. That’s a striking statistic, since new research from the nonpartisan Tax Policy Center (TPC) finds that the vast majority of the country, including 90 percent of middle-class families, will get a tax break.
But another possibility is that Americans don’t like the tax bill because they understand exactly what it does. Most Americans seem to think that the GOP tax bill overwhelmingly benefits the rich at a moment when large corporations and affluent families don’t need much legislative assistance in their multi-decade dominion over the economy. In fact, the GOP tax bill does just that.
Why are Republicans doing this? First, it is conservative economic dogma that low taxes on the wealthy encourage business expansion and job creation, so that tax cuts for the penthouse “trickle down” to the lower floors of the economy, in the form of jobs and higher wages. Recent history has either punctured or demolished this point of view, as the Reagan and Bush tax cuts quite clearly failed to produce additional revenue or benefit middle-class wages. Second, as a practical matter, Republicans, like Democrats, need lots of money to run for office. But on the right, these funds are mostly supplied by a small base of corporate-libertarian donors, like the Koch brothers, who have for decades encouraged lawmakers to cut taxes and welfare spending to galvanize the economy. Republican politicians might prefer to support an unpopular bill, and risk losing some votes, than pass nothing and lose the critical donor support required to procure any votes.