Six months is a long time in politics. So you can be forgiven if you’ve already forgotten that it was Democrats who, back in November and December, worked feverishly to defeat the tax reform bill.
Senate Democratic leader Chuck Schumer called it “a monstrosity and such a danger to the country.” House Democratic leader Nancy Pelosi called it “Armageddon” and “the worst bill in the history of the United States Congress.” They howled that the bill would unjustly enrich corporations while claiming, falsely, that the poor and middle class would be stuck with higher tax bills.
The bill became law without a single Democratic vote. Half a year later, it’s possible to judge the new law with greater perspective. Consider: The Labor Department reported Friday that the country’s unemployment rate fell to 3.9 percent, the lowest level in 17 years. Consumer confidence is the highest in 17 years. First-quarter economic growth was its strongest since 2015. And, in perhaps the most significant sign of a bullish economy, wages are on the increase.
If this is Armageddon, let’s have more of it.
Far from creating a Marxist dystopia in which wealthy thrive while poor battle for scraps, the beauty of cutting taxes is that it’s not a zero-sum game: A little more here doesn’t necessarily mean a little less there. Returning money to workers empowers them to save or pay debts. Reducing taxes for businesses allows them to invest, raise worker pay, or return money to owners.
Sensible tax policy is no guarantee of permanent economic expansion, and Washington’s refusal to restrain government spending, if it continues, will have dire consequences. But the economy’s continued success after such a major tax overhaul should put to rest any big-government talking points theorizing that lower taxes are an attack on American prosperity and social equity.
Even companies that attacked the tax cuts now say they are benefiting from them. Starbucks, whose CEO criticized the tax cuts as unnecessary, stands to save $500 million in lower taxes. Berkshire Hathaway, whose CEO, Warren Buffett, criticized the tax bill last year as a giveaway to the rich, said this year that lower taxes boosted company finances by $29 billion. The New York Times, which fulminated against the bill to the point of sheer partisan hackery, announced Thursday that its taxes in the first quarter fell by $5.3 million, “primarily due to a reduction in the U.S. federal corporate income tax rate.”
Of course, those feeling undertaxed are free to give up those gains. The Treasury Department’s Bureau of the Fiscal Service says it accepts contributions by check, credit card, debit card, bank transfer, and even PayPal. We don’t expect to see a surge in principled contributions.
