Saturday, October 30, 2021
This new spending number that is circulating at $1.75 trillion is phony boloney. It’s larded with gimmicks and not credible. The Wall Street Journal’s editorial today called it a “jerry-rigged budget framework.” They are right.
Basically, the Democrats are scoring permanent programs as one-year temporaries. Like extending the child-care tax credit for a one-year cost of $110 billion, when in fact it’s a 10-year cost of well over $1 trillion. Ditto for expanding Obamacare subsidies. And expanded Medicare and Medicaid services.
The Journal puts the cost at $4 trillion. If the Democrats were to disclose their true intentions of a permanent and reckless expansion of the government welfare state, it would score far higher.
Meanwhile there are these late entry — or reentry — tax hike proposals, such as a corporate minimum tax for domestic and foreign company income, and higher marginal tax rates, such as a 5% surtax on income above $10 million and 8% above $25 million.
This, by the way, includes basically the backbone of American business, S-corps, LLCs, and wholly owned proprietorships that are the backbone of American business. This would be a huge discouragement for investment, capital formation, job creation, and higher wages.
In blue states like New York and California, the top marginal personal tax rate would come to around 60%, higher than Europe. I’m assuming the goofy billionaires wealth tax on unrealized capital gains has finally been laughed off the table. but who knows?
So I’m taking the Napoleonic position. I know he could be a megalomaniacal totalitarian, but even those people have occasional wisdom. Never, he’d say, interfere with an enemy while he’s in the process of destroying himself.
So Joe Biden is going to Glasgow empty-handed. No tears from this source. You know what I’m going to say. Save America. Kill the bill.
Lawrence Kudlow. Sensible as usual.