No. of Recommendations: 7
Now let's consider the beating the other brackets take. Those 5/6/8/9 bracket raises of yours? Guess who they nail. Small business owners! The ones who are sole proprietors or other pass-through entities who taxes flow right to their individual 1040s. Up their rates by that much and you can say good-bye to your favorite restaurant in many cases because their margins can't handle it.
And so goes the ripple effects because we don't want to even consider the possibility of any kind of reform.
And who takes the beating if you slash Social Security and Medicare by 20%? The entire medical and health care sector, for starters - obviously. But also all the small business owners who provide services to that sector and all the ones who have elderly folks among their clientele.
And so goes the ripple effects because we don't want to even consider the possibility of any kind of tax increase.
But....that's not really this discussion, right? No one's refusing to consider the possibility of some kind of reform. We both agree that something will need to be done soon. No one disagreed that this is a problem and something will need to be done about it. In fact, none of this is a surprise to anyone - when the TCHA was being considered in 2017, most analysts pointed out that passing it would blow up the budget deficit and cause a major fiscal fustercluck. To which the GOP said, "no, it will pay for itself and deficits won't materialize, because economic growth will skyrocket and the tax cuts will pay for themselves and all those analysts are just people who are biased against Trump." So now the massive deficits have materialized, the GOP counterarguments were wrong...and we find ourselves here. So of course we need to reform either our spending or our tax provisions.
What we're talking about is which kind of reform is more likely, given the politics of it all. Since Medicare and Social Security are immensely popular and longstanding and benefit the sort of people who are most likely to vote, and since the GOP has moved substantially away from trying to shrink popular government programs and more towards populism, I'm guessing that we end up with raising taxes rather than cutting Medicare and Social Security.