Radio America Online News Bureau

tax reform

20 States Take Aim at Obamacare

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The recent tax cut legislation also puts an end to penalties for failing to buy health insurance, a development 20 states now argue should render the rest of Obamacare unconstitutional.

Led by Texas Attorney General Ken Paxton, the states filed suit in federal district court in Fort Worth on Monday, asking for an injunction against continued enforcement of the Affordable Care Act and, ultimately, for the law to be struck down.

President Trump and Republicans often assert that the tax bill repealed the individual mandate, but that’s not exactly correct.

“It made the individual mandate a zero.  It zeroed it out, which is what they could do because the Supreme Court had declared the individual mandate a tax but it didn’t strike the language from the statute,” said Rob Henneke, a former colleague of Paxton’s who is now general counsel at the Texas Public Policy Foundation.

“So part of the argument that the states have here is that because the individual mandate is set at zero, it is not performing the functions of a tax and therefore cannot still be construed constitutional by the Supreme Court under the taxing powers of Congress,” said Henneke.

And why is that?  In 2012, despite ruling that the law violated the Commerce Clause of the Constitution by forcing Americans to purchase a product, Chief Justice John Roberts saved the Affordable Care Act by declaring the the individual mandate a tax, which is within the powers of Congress.

Henneke says without that rationale, Obamacare collapses.

“The whole crux of that regulatory scheme rests on the essential component of being able to compel Americans to purchase health insurance or pay this tax penalty.  Now that that one card has been pulled out of that house of cards, the states argue that the entire regulatory scheme collapses,” said Henneke.

Henneke admits that the justices seem very reluctant to confront Obamacare again, but he says the states are hoping Roberts will reverse course once he’s confronted with his own words.

“In this situation, it is the Supreme Court’s own words in the NFIB v. Sebelius case, where they point to the individual mandate as the key component in what made the Affordable Care Act constitutional,” said Henneke.

Another big question, says Henneke, is whether the defendants will put up much of a fight this time around.

“It remains to be seen what position this administration and the Department of Justice is going to take and if and how they are going to defend the law.

“The president has been very critical of the Affordable Care Act.  It’s been a cornerstone of what he campaigned on.  Are they really going to disagree with the 20 states that have challenged the constitutionality of this law or do they agree with the argument presented by the states? ” said Henneke.

He says it’s also possible that this case could make it through the system pretty quickly.

“[The states] are asking for a court to enjoin the Affordable Care Act, to have a court order that would stop that law from continuing.  That is the ultimate relief that is sought in the lawsuit. but stay tuned.  We may see those states come to court earlier and ask for a preliminary injunction to stop the Affordable Care Act while the lawsuit goes on,” said Henneke.

“If that happens, then that could be a decision that moves up through the court system much, much faster than the three or four years it takes a lawsuit to normally get through the trial court,” he added.

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Brady Talks Tax Reform

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The man who spearheaded the tax reform effort in the House of Representatives says the new provisions will accelerate America’s economic growth and surpass previous expectations thanks to middle class tax relief and a far more favorable environment for corporations and small businesses.

On Wednesday, both the House and Senate approved the $1.5 trillion package without any support from Democrats on either side of Capitol Hill.  The win for the GOP ends the year on a political high months after the deep frustration of failing to pass an Obamacare repeal or reform bill.

House Ways and Means Committee Chairman Kevin Brady, R-Texas, led the tax reform push in the House of Representatives.  He says the key to success on this package was Republicans all starting on the same legislative page.  And Brady says the credit for that belongs at the other end of Pennsylvania Avenue.

“We started off from a good place.  There was a lot of common ground.  That’s because President Trump agreed this summer to work with the House and Senate tax writers towards one tax reform approach.  That really made the difference in my view,” said Brady.

There were some important differences between the original House and Senate bills that needed to be ironed out in a conference committee.  The Senate got its way in keeping seven tax brackets, although they were adjusted to make sure the vast majority of Americans got a tax cut, and repealing Obamacare’s individual mandate.

The House also won some tussles in conference, including what Brady believes might be the most important provision in the bill.

“The most important economic issue was to make sure that these tax cuts occurred for local businesses  as well as our companies that compete around the world now, on January 1st of next year.  We need that growth and expansion now,” said Brady.

In the end, Brady says the final bill was better than either the House or Senate bills, something he says almost never happens in Congress.

The passage of the tax reform package comes at a time when the stock market is booming and economists see GDP growth of three percent or more for quite a while.  Brady says the new laws will accelerate our growth even more.

“[Economists] think that will stay this way for another decade or more, so the question for the country is do we just settle for this very slow growth where paychecks never move and kids come out of school without good paying jobs or do we shake it up?” asked Brady.

“This tax reform plan was about shaking it up, giving people back more of what they earn, creating an economy where their paychecks grow and getting our jobs back from overseas.  This tax reform plan achieves that in a big way,” said Brady.

Brady says virtually everyone will benefit from the new law, starting with middle class families.

“If you look at the typical family of four in America, they make $73,000, so two blue-collar workers.  They save $2,059.  I know Washington doesn’t think that’s much.  But for American families, that really matters,” said Brady.

A dozen House Republicans voted against the bill over the issue of state and local tax deductions.  Previously, Americans could deduct those against their federal taxes.  The new bill restricts the deductions to the first $10,000 in state and local taxes, meaning wealthy people in high tax states like California, New York, Connecticut, and New Jersey may well see higher tax bills.

But Brady says everybody else will have more money in their pockets.

“I don’t believe it will.  Even the Tax Policy Center, which is very, very liberal and doesn’t even count growth and pretends the economy never changes – even they say 90 percent of Americans will see a tax cut, a real tax cut.  Five percent will be close to break even.  So this is real tax relief,” said Brady.

The biggest cuts, however, are for businesses, with corporate rates dropping 40 percent from 35 percent to 21 percent.  Democrats assert that the money won’t go to new jobs or company expansion but will instead line the pockets of executives and shareholders.

Brady disagrees, contending businesses have been begging for tax relief for years in an effort to get more competitive.

“That 21 percent rate was all about making our businesses able to compete and win anywhere in the world, including here at home in America, then to be able to bring their earnings back to be reinvested in America.  They can’t do that today.

“So that rate wasn’t a giveaway.  It was a ‘get-them-back’ tax rate to bring our jobs back to America and make sure our workers and their businesses can compete,” said Brady.

Critics aren’t so sure.  In a column for the Weekly Standard, Matt Labash excoriated Republicans for throwing crumbs to the middle class while giving a big wet kiss to big business.  Labash points out that of the $1.5 trillion in tax relief, one trillion goes to businesses and $200 billion comes in estate tax relief, leaving just $300 billion over ten years in personal income tax relief.

Brady believes that’s a bad interpretation of the impact this bill will have on middle class families.

“Middle class tax relief is the top priority.  You’ll see in there, up and down those income brackets, people are going to be able to keep more of what they earn and, more importantly, get those paychecks up by encouraging businesses to invest in workers in their companies.  That is good for middle class America,” said Brady.

Leading liberals in Congress have used very strong language to condemn the legislation.  House Minority Leader Nancy Pelosi, D-Calif., called it the worst piece of legislation ever to come to the House floor.  Sen. Bernie Sanders, I-Vermont, predicted it would lead to the deaths of 10,000 Americans each year.

“I think they’re so obsessed with these things that they’ve ignored what this really does, which is to get America growing again and get people back on their feet in the economy,” said Brady.

“When they talk about the worst piece of legislation, I think most people look at Obamacare that’s the worst piece of legislation that’s been approved.  Getting the individual mandate removed so people have choice about whether they want that health care is very critical,” said Brady.

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Brat Hails Final Tax Bill

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Republicans are celebrating Wednesday after both the House of Representatives and Senate approved major tax reform legislation, laws which supporters claim will put badly need money in the pockets of American families and giving an already improving economy an even bigger boost.

The final bill is a compromise hammered out between differing House and Senate versions that were approved separately in recent weeks.  House Freedom Caucus member Rep. Dave Brat, R-Virginia, says the new law is far better than what he expected to emerge from the congressional negotiations.

“I was fairly shocked.  Up in D.C., usually at year-end when you go into conference I usually don’t like the outcome.  But in this case, we fixed a lot of the issues.  We had a college student loan issue, a graduate student piece.  There was a Medicare piece, a small business piece.  All of those got major improvements,” said Brat.

Brats admits he wishes the the final bill would have called for three tax brackets instead of seven, but he says there’s still good news there.

“By rearranging those brackets, they ensured that way more people get a tax cut.  A single woman with a child gets over a thousand dollars back.  That’s great.  A family of four with two kids, married and making $70,000 – that’s the typical income in my district – they’re getting $2,059 back,” said Brat.

“The corporate rate goes down from 35 percent to 21 and it takes place this year.  In the Senate plan, they were going to lag that a year.  In conference, we fixed it so it goes into place.  That’s probably the most important piece,” said Brat, who says the stock market has been soaring in anticipation of this bill getting passed.

Brat says another big group of winners are young people looking for work.  He says businesses will now be in better position to hire people for good jobs.

“I think the kids I taught for 20 years are going to go out.  They’re going to have multiple job offers and go out and live the American Dream.  That’s the goal of this thing.  The kids go out and get good jobs.  That’s a virtuous cycle, so I’m proud of it,” said Brat.

And while Democrats all voted against the bill, claiming Republicans were giving big tax cuts to businesses and rich people at the expense of the middle class, Brat says the facts prove otherwise.

“The Democrats on the floor today were just apoplectic on the thing.  I’ve never seen such emotion and misinformation.  We’ve (supposedly) raised taxes on the middle class for the rich.  They just can’t overcome the basic facts,” said Brat.

Some Democrats admit that middle class families will get some tax relief but suggest the $1,000 or $2,000 in extra income only amounts to a few dollars a day and makes no tangible difference.  Brat disagrees.

“They’re making fun of giving back money to lower income folks, which I thought they would applaud.  A thousand dollars or two thousand for a family of four, that’s some big bucks.  That pays for a lot of stuff that families don’t currently have,” said Brat.

He says the emotional denunciations from the Democrats are designed to distract from their dearth of ideas.

“If you want to reject a hypothesis, you have to offer a better hypothesis and they don’t have that,” said Brat, noting the the Democrats’ budget called for $10 trillion in new taxes and $11 trillion in new spending over the next decade.

“If you raised taxes $10 trillion, you would go into a massive recession next year.  Period.  End of sentence,” said Brat.

He says eight years of Obama economic policy led to anemic economic growth.

“You saw the evidence over the last ten years.  You didn’t have growth.  Your growth was at one and a half or two (percent) tops.  Now we’re at three percent and the Federal Reserve has us at four percent next quarter,” said Brat.

While Brat admits the bill does not pay for itself and projects a $1.5 trillion deficit over ten years, he says the impact of the bill should easily lead to additional revenues to cover that amount.

“If you put the tax package together with capital incentives and lower rates and less regulation, all you have to do is come up with $150 billion a year in growth, and we’re going to blow by that with ease,” said Brat.

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Tax Reform Passes, GOP Flirting with Taxpayer-Funded Abortions? Rosie’s Bribery

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Jim Geraghty of National Review and Greg Corombos of Radio America cheer House and Senate passage of tax cuts and tax reform, noting the vast majority of Americans will see bigger paychecks while the Obamacare individual mandate gets repealed and energy exploration in the Arctic National Wildlife Refuge is given the green light.  They also recoil at reports that Senate Republican leaders may have agreed to Obamacare bailouts and taxpayer-funded abortions in exchange for Sen. Susan Collins voting for the tax bill.  And they discuss Rosie O’Donnell offering two million dollars apiece for Collins and Sen. Jeff Flake to vote against the tax legislation.

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Trump Slashes Regulations, Tax Bill Drama, Net Neutrality Hysteria

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Jim Geraghty of National Review and Greg Corombos of Radio America applaud President Trump for making good on his efforts to eliminate and postpone costly and burdensome federal regulations.  They also tense up as five different Senate GOP votes could be in jeopardy as vote nears on tax reform.  They shake their heads as liberals lose their minds and predict an internet wasteland after the Federal Communications Commission votes to return internet regulations to where they were two years ago.  And Jim offers a spoiler-free look at the new Star Wars movie.

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Closer to a Tax Cut, Disney to Gobble Up Fox, Strzok’s ‘Insurance Policy’

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Jim Geraghty of National Review and Greg Corombos of Radio America are cautiously optimistic that Republicans may soon pass a tax cut and while the proposal is not perfect, it moves in the right direction on a number of fronts.  They also react to Disney becoming an even more mammoth presence in entertainment with the news it is paying over $52 billion to buy most assets of Fox.  And they discuss the latest hit to the credibility of the Russia investigation, as a recently fired Mueller deputy referred to pursuing an “insurance policy” just in case Trump won the election.

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ABC Suspends Ross, GOP Rep’s Sex Harassment Payout, Lib Meltdown Over Tax Vote

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Jim Geraghty of National Review and Greg Corombos of Radio America welcome the decision of ABC News to punish Brian Ross over his sloppy, false, and damaging report about when President Trump urged Mike Flynn to make contact with Russia – just the latest in a long history of shameful reporting by Ross. They also erupt as Republican Texas Rep. Blake Farenthold reportedly used $84,000 of taxpayer money to settle a sexual harassment complaint made by his former staffer. And they chronicle the liberal hysteria following the Senate vote on tax reform – including assertions that the vote killed America, that it will kill millions of people, and that it is akin to raping poor people.

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Tax Cut Momentum, Kim’s Ominous Missile, NBC Fires Lauer

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Jim Geraghty of National Review and Greg Corombos of Radio America are very cautiously optimistic about tax reform getting done after the Senate Budget Committee approved the Senate bill and several of the likely holdouts now seem ready to pass it.  They’re also concerned following the latest North Korean missile test, which seems to indicate the communist regime could hit the U.S. mainland with a nuclear-armed ICBM.  And they react to NBC firing longtime “Today” host Matt Lauer over sexually inappropriate actions.

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Economy Depends Upon Tax Cuts Becoming Law

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The Senate Budget Committee approved a tax reform bill along party lines Tuesday, sending legislation to the Senate floor that a key fiscal conservative lawmaker says is vital to pass if Americans want to see the economy continue growing and eventually booming.

The vote in the committee was 12-11, and included ‘yes’ votes from Sens. Ron Johnson, R-Wisc., and Bob Corker, R-Tenn.  The bill already cleared the Senate Finance Committee and will now be considered by the full Senate.

Senate Majority Leader Mitch McConnell admitted Tuesday that getting to 51 votes in favor of the bill is still a work in progress, but Rep. Dave Brat, R-Virginia, a member of the House Freedom Caucus, says Republicans must push this bill across the goal line or the economic consequences will be severe.

“Our economy needs it and you see every day on the financial channels that if anyone hiccups and there are two ‘no’ votes then the market goes down,” said Brat, contending that investors are bullish because they are assuming tax reform will get done.

“That’s an objective reality that’s out there.  This is baked in the cake and if we don’t come up with these tax cuts, the economy will not continue to grow like it has been.  It’s been flying high and consumer expectations are high and that’s where we want to keep it,” said Brat.

The effort to sway moderates took a bit of a hit this week, when the Congressional Budget Office, or CBO, estimated that the Senate bill would add $1.4 trillion to the national debt over ten years and would hurt middle class and poor Americans the most.

Brat is firing back on multiple fronts, first challenging the CBO’s recent history of badly inaccurate estimates.

“I think that’s probably based on the teachings of Karl Marx.  They’ve been wrong so many times on every thing they do,” said Brat, noting a recent report on health care costs in Charlottesville, Virginia.

“The CBO said Obamacare was going to lower the cost of health care.  Now the premiums for a family are $30,000.  The deductible is $9,000.  So you’ve got to pay $39,000 before you see one dollar of insurance.  There’s CBO’s infinite wisdom on scoring the costs of these things,” said Brat.

Despite the frequent criticism of capitalism, Brat says world history proves the free market is the surest path out of poverty.

“Is capitalism good for the poor or is communism and command systems and top-down (better)?” said Brat.  “The history of nations is the history of poverty unless you have capital accumulation.”

Brat says the GOP approach of allowing deductions for all capital will not only be a boon for business owners but will likely mean more money in pockets of employees.  He says that’s a far cry from the Democrats calling for higher taxes and much higher spending.

“They want to increase $10 trillion, increase spending $11 trillion and they end up with more debt than wee do in our tax piece even after they they raise taxes $10 trillion in the Progressive Caucus budget and tax plan,” said Brat.

While confident Republicans have a good plan, Brat says they need to do a better job of messaging.

“I wish the mainstream media was more fair in the messaging and our team needs to do a much more aggressive job of messaging about the benefits of free markets,” said Brat.

Sen. Johnson and Sen. Steve Daines, R-Montana, had earlier said they could not support the existing Senate bill because it provided far more benefits to corporations than to small businesses.  Johnson says he’s encouraged by some changes made to address his concerns.

Brat says Johnson and Daines are right that pass-through businesses that file at the individual rate need more help in the legislation.  He says the House worked to beef up tax breaks for those small businesses, including just a nine percent tax rate on the first $75,000.

He also says Americans will be helped by married couples paying just 12 percent on income below $90,000.  The next bracket, 25 percent, stays in place up to $260,000.

Brat would like to see more help for small businesses, but he says math is a real challenge for the GOP in making all of this work.

“There’s about $6 trillion in tax cuts and $4.5 trillion in pay-fors, so on net they know there’s only so much you can put around, so you want it to be as pro-growth as you can be,” said Brat.

But Brat says time is of the essence and Republicans need to get the job done.

“They all know we have to have these tax cuts go into effect,” said Brat.  “It’s going to be a net win for everybody.”

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Tax Cut Bill Revealed, Trump’s Execution Tweets, Northam’s Epic Flip-Flop

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Jim Geraghty of National Review and Greg Corombos of Radio America largely cheer the House Republican tax plan, which cuts business and individual tax rates, kills the death tax and simplifies the system.  They also sigh as President Trump tweets out his desire to see this week’s Manhattan terrorist face capital punishment, a public statement many Americans agree with but could complicate federal prosecution of the murderer.  And they highlight the latest development in Virginia Democrat Ralph Northam’s no good, very bad week, as the candidate for governor flip-flops and suddenly supports banning sanctuary cities in Virginia.

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