There are lots of pressing issues Congress could be focusing on right now.
Lawmakers could work on reauthorizing the Children’s Health Insurance Program, which expired Sept. 30, leaving the 9 million kids who depend on it in limbo.
Or maybe they could find a solution for so-called “dreamers,” the undocumented immigrants brought here as children, who will lose their protected status soon unless Congress acts.
Or, hey, they could try to prevent the U.S. government from setting off a worldwide financial crisis. That’s something that might happen in less than two weeks, when we hit the debt ceiling.
Instead, Republican senators have a different priority: jamming through their plutocratic, sloppy tax overhaul as quickly as possible. By “as quickly as possible,” I mean as soon as this week, which would be a mere month after the first draft of the GOP tax bill was introduced in the House.
For comparison, the last time such a major overhaul happened — during the Reagan administration — the process took more than two years. And it included dozens of hearings and consultations with voters, tax practitioners and experts.
That’s nothing like the full-steam-ahead approach we’ve seen this time around.
Why the haste?
Republicans are of course desperate to notch a legislative win before the year ends, especially given their failed promise to repeal Obamacare.
But perhaps more important, Republican lawmakers need to pass this terrible bill before voters — and indeed lawmakers themselves — have a chance to learn what’s in it.
“It’s an ostrich approach to tax policy,” says Steven Rosenthal, a senior fellow at the nonpartisan Tax Policy Center.
Republicans don’t want to learn what their own bill will cost, for instance.
For years, Republicans promised that their tax cuts would pay for themselves, once you accounted for all the economic growth they’d unleash. They even mandated that Congress’ own nonpartisan internal scorekeepers take into account this “macroeconomic feedback” when evaluating the budgetary effect of major bills such as this one.
But now the Senate is racing to vote before those scorekeepers have a chance to evaluate their claim about the bill’s cost (or lack thereof, supposedly).
This is surely no accident. Outside groups, including one favorable to the tax overhaul, have already done their own analyses. So far none has found that the bill generates enough growth to pay for itself.
There’s also that little inconvenient truth about whom the bill benefits.
Republican leaders keep claiming the bill focuses on helping the middle class. But voters are already catching on to the fact that the biggest tax cuts go to the wealthiest. Lately the public has learned that the Senate bill will actually raise taxes for households making less than $75,000 by 2027, relative to current law. Yes you read that right. And it’s true even if you don’t count the bill’s changes to Obamacare.
The more time that passes, the angrier these voters will get, and the more pressure they’ll presumably place on elected officials to either change or oppose the legislation.
Which is yet another reason to vote on the bill ASAP: Familiarity will breed (even more) contempt.
Unfortunately, rushing this bill through means that in addition to all the deliberate goodies and giveaways to the rich, there will be lots of unintended goodies and giveaways. That’s because, given the haste with which this bill was drafted, the plan remains full of glitches.
Consider the so-called “guardrails” intended to prevent workers from self-incorporating and taking advantage of the new preferential rate on pass-through income. Those remain extremely easy to game.
Meanwhile, some pass-through businesses will (oops) face marginal tax rates of 70 percent. Under normal circumstances, a tax rate this high would send Republican policymakers running for the hills.
There are other foreseeable problems, too.
The bill may violate World Trade Organization rules, for example. And the shift to a territorial taxation system would also likely encourage companies to shift more, not less, of their operations abroad.
The interaction of some other provisions would encourage taxpayers to make investments that they know would lose money, as New York University School of Law professor Daniel Shaviro has pointed out.
Those are just some of the problems that tax experts have identified so far. Surely more will come out in the weeks and months ahead, as clever accountants and tax attorneys identify new ways to take advantage of slapdash legislative language.
If Republicans were smart, they’d give themselves sufficient time to properly vet and craft this legislation. Apparently, they’d prefer to keep their heads in the sand.