Listen to “GDP Grows at 4.1%, Jail Time for Election Lies? Michael Avenatti 2020?” on Spreaker.
Jim Geraghty of National Review and Greg Corombos of Radio America celebrate the booming economy that hit second quarter growth of 4.1 percent. They also notice the Democrats want to institute five years of jail time for spreading false information about elections dates and locations. And they see that Michael Avenatti was invited to speak to Iowa Democrats and they hope the party won’t take him seriously simply because he hates President Donald Trump.
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How the Obamacare Flop Impacts Tax Reform
The implosion of the Senate’s attempt to address Obamacare also makes effective tax reform more difficult, but the leader of the nation’s largest grassroots taxpayers organization is still optimistic big things can get done.
But make no mistake, repealing the Obamacare taxes was supposed to grease the skids for the tax reform effort.
“The task has not been made easier by the lack of progress on Obamacare repeal and replace, but we’re going to have to approach this with a lot of vigor right now. The American people are waiting to see that this Congress and this administration can get something comprehensive done,” said National Taxpayers Union President Pete Sepp.
How does the failure of the Obamacare repeal specifically impact the tax reform push?
“We’re going to have to deal with some of the Obamacare taxes in some fashion, through tax reform or outside of tax reform simply because several of those Obamacare taxes directly effect conventional income tax rates,” said Sepp.
“I’m talking about, for example, the earned income surtax of 0.9 percent, also the net investment income tax of 3.8 percent. Those types of taxes will actually increase the rate that members of Congress are trying to lower over the long term,” said Sepp.
Nonetheless, Sepp is bullish, even after watching the flop on healthcare in Congress because it appears congressional leaders and administration officials are all singing from the same songsheet this time.
“That means lower tax rates, simpler tax filing procedures, making sure that small businesses don’t pay a higher tax rate than larger ones and, in fact, should pay a lower rate. There are also things that will help to address the lack of competitiveness of our companies overseas and the tax disadvantages there,” said Sepp.
Sepp is pleased that the House Ways and Means Committee and the Senate Finance Committee are working in tandem on legislation rather than crafting completely separate bills. He also says GOP friction should ebb greatly now that all the major players agree to stop pursuing the Border Adjustment Tax, which would place taxes on goods entering the U.S.
In addition, Sepp is excited about Republicans trying to drop the corporate tax rate from 35 percent to somewhere between 15-20 percent, and he says the rate for small businesses should be even lower.
He also is hopeful that Congress can remove the massive paperwork burden for business owners.
“We also need to look at how business claim their expenses and write them off. This is an incredibly complex area of the tax code. It amounts to anywhere between 30-50 percent of the paperwork burden that a business faces,” said Sepp.
On individual tax policy, Sepp wants to see Congress pursue much lower tax rates in exchange for removing the vast majority of deductions that are currently available to taxpayers. He says rates really need to plummet before that trade is a good deal for most Americans.
“The rates range from 10 percent to over 40 percent currently. We need to get the rates down even lower, five percent or even zero if we expand the standard deduction and perhaps a top rate of 30-35 percent. If we do that, the trade off of deductions will be worth it,” said Sepp.
Sepp stresses that the status quo is not an option. He says America suffers more each year as America fails to use the tax code for our economic advantage.
“Tax reform needs to happen because companies are inverting every day. They’re taking their headquarters overseas and with it a lot of profits that could be taxed here. The tax code is getting more complex every year. Even if we don’t pass new laws, implementing old ones and designing all the regulations around them add to that burden,” said Sepp.
‘Swamp’ Aligns Against Trump on Climate Treaty
President Trump is running out of time to make good on his promise to withdraw the United States from the Paris agreement on climate policy obligations, and the delay is largely due to many different interests imploring him to back away from his campaign pledges.
As Trump embarks on an ambitious eight-day trip to the Middle East and Europe, the pressure is only growing on him to keep the U.S. committed to the Paris deal. However, Competitive Enterprise Institute Senior Fellow Christopher C. Horner, who served on Trump’s transition landing team at the Environmental Protection Agency, says all Trump needs to do is make good on his word.
“We have to go back to the campaign and remember that a decision was made and it was to get out,” said Horner. “He gave reasons why. He said this would give others control over our energy use, how much we could use the things that are reliable and affordable, as well as the massive wealth transfer. He made the decision.”
The Competitive Enterprise Institute released an advertisement last month urging Trump to stay true to those campaign promises.
What has changed? Horner says a lot of different interests are pushing him to accept the status quo.
“The brakes were put on it because different influences came into play. There were what I’ll call swamp considerations, which were not obviously considerations in the campaign. In fact, he ran against the swamp. Once he got here, those interests are considerable,” said Horner.
Horner says there is a long list of people and interests looking pressuring Trump to keep the U.S. in the agreement.
“(There are) tremendous business lobbies, tremendous resistance among (the government) holdovers. I could tell you blow by blow about a lot of these officials as well as some Trump appointees. But as you also know, some family members are feeling and exerting what we’ll call Manhattan social pressures to not have to defend keeping this promise,” said Horner.
Some businesses and industries are at the forefront of protesting climate-inspired restrictions, but Horner says much of big business is on board with the climate agenda for multiple reasons. He says a lot of big companies are eager for the federal subsidies that come with compliance with the Paris accords.
“The reason is simple. When you rob Peter to pay Paul, you’re guaranteed Paul’s enthusiastic support and sometimes it was Paul’s idea. So you’ve got this base of industry support, the ones who would benefit,” said Horner.
He says those same businesses also see more restrictive policies as an advantage against the competition.
“They love instituting policies that are barriers to entry to new participants or that smaller competitors can’t handle as well. Some businesses were publicly saying in news reports that, ‘We’ve planned for this so we need this to happen,'” said Horner.
Even among Trump’s top diplomats, there is deep division on the issue.
“The UN Ambassador Nikki Haley is reportedly very strong on this, even though, as I’ve said before, State will do what’s in the State Department’s interest and (withdrawing from the accords) makes Rex Tillerson’s life more difficult and not easier,” said Horner.
Horner also expects Trump’s time in Europe to be one long lobbying effort to keep the U.S. in the agreement.
“The Group of Seven, the leading economic nations who want – as a State Department cable that I found in litigation shows – they want us to share the pain, to relieve the burden of our competition of not having this agenda saddle our economy,” said Horner.
Published reports suggest multiple deadlines to make a decision on U.S. involvement in the accords have come and gone. He says that’s largely because Trump is trying to resist the tide aligned against his instincts.
“We’ve got it on pretty good authority what the president still thinks. He wants out and wonders aloud why he can’t just keep his promise. He’s surrounded by influencers saying, ‘You can’t do it for the following reasons.’ But some people are saying, ‘You have to (withdraw) for these reasons, the same reasons you said you would,” said Horner.
If Trump relents, Horner says President Obama’s promise that our electricity rates will “necessarily skyrocket” will come true and the cost of everything related to energy costs will also shoot up.
“The price will go up, leaving you with less disposable income and a less resilient lifestyle, less healthy because you’re less wealthy. There’ll be more hypothermia, more of seniors and the vulnerable dying from energy poverty. That’s what it’s going to mean for you,” said Horner.
Horner fears that if Trump was going to withdraw the U.S. from the agreement, he would have done so already. However, he is not giving up hope given Trump’s adamant campaign promises.
If Trump doesn’t make good on that vow, Horner says it will be a strong example of how difficult it is to reverse the tides in Washington.
“It means the swamp isn’t as easily defeated as a lot of people hoped,” said Horner. “This is really, so far, the ultimate test of his battle against the swamp.”