Long-Awaited Republican Tax Plan is Underwhelming

by Jim Geraghty

Making the click-through worthwhile: Republicans leave out some consequential details about their plan to cut taxes; President Trump makes the right call on shipping aid to Puerto Rico; why Oprah 2020 isn’t so unthinkable despite the record of celebrity-politicians; and how Trump is, for better or worse, delivering exactly the kind of presidency he promised.

Hey, Did You Guys Forget Some Pieces of this Tax Plan?

My colleagues weigh in on the tax plan unveiled by Congressional Republicans and the White House, and they seem a little underwhelmed, at least until the GOP fills in some of the blanks.

Ramesh Ponnuru observes that there’s a piece missing that could have far-reaching effects: the total amount of the child tax credit — an amount of taxes the government “credits” you with paying just by claiming a child as a dependent.

The relevant parts of the plan 1) increase the standard deduction to $24,000 for married couples, 2) increase the child credit by an unspecified amount, 3) raise the lowest marginal tax rate from 10 to 12, and 4) eliminate the personal and dependent exemptions. How it nets out depends on a particular household’s configuration and the ultimate answer to 2. It’s a pretty big detail to leave out. It determines how much middle-class tax relief the plan offers, and whether the plan has a pro-family element. As I pointed out in recent testimony before the Senate Finance Committee, the child credit would have to increase at least $600 per child to offset the elimination of the dependent exemption.

I would have vastly preferred if the framework had said that the child credit will increase by at least $1,000. And I think Republicans would be having a better rollout today if it had. Republicans have plenty of time to fix this problem. Recognizing it and committing to solving it would be a good start.

Robert Verbruggen points out that for taxpayers without children, some of these changes will offset each other, making the total reduction in tax bills disappointingly minor.

Under current law, someone single and childless gets to knock $10,400 off their income before the bottom rate of 10 percent applies; under the GOP plan, they’d knock $12,000 off but see a rate of 12 percent. The low-income would still get a tax cut, but often a tiny one — at least until you factor in some vaguely worded changes to the child tax credit for parents, as well as “additional tax relief” that is not specified at all. Here’s what this change looks like for those who are single, childless, and making up to $19,725 — where the first bracket ends, after accounting for deductions and exemptions, under current law. It’s a pretty mild cut, especially toward the top of that range. If you make exactly $19,725, you save all of $5.50.

Don’t spend it all in one place!

Kevin Williamson:

The bottom half of income earners pay essentially no federal income tax, though they pay other federal taxes, including the payroll tax. Trump’s tax plan would add to the burden at the top and take even more people off the tax rolls at the bottom. Ronald Reagan used to boast of all the low-income Americans his policies took off the tax rolls entirely. I’m not sure that was all to the good. We have a large, active federal government that redistributes a lot of money. Everybody ought to pay a little something in federal income tax if we are going to have a federal income tax. Surely, nobody’s “fair share” is really $0.00. Everybody likes to sit by the fire, nobody wants to chop the wood.

Of course, the final changes could end up considerably different from this outline.

Trump Makes the Right Call, Waives the Jones Act for Puerto Rico Aid

Credit where it’s due: President Trump made the right call.

The White House has authorized a waiver to loosen shipping rules regarding Puerto Rico that island officials say would be a significant help for recovery efforts from Hurricane Maria.

“At @ricardorossello request, @POTUS has authorized the Jones Act be waived for Puerto Rico. It will go into effect immediately,” White House press secretary Sarah Sanders tweeted Thursday morning.

He joined the growing list of officials who argued that lifting the the Jones Act — a federal law designed to protect the financial interests of US shipbuilders by limiting shipping by foreign vessels — would help expedite supplies to the ravaged island. The act has had the unintended consequence of making it twice as expensive to ship things from the US mainland to Puerto Rico as it is to ship from any other foreign port in the world, according to Arizona Republican senator John McCain’s office.

Yesterday, Trump had said, “There are a lot of people who work in the shipping industry that don’t want the Jones Act lifted. And we have a lot of ships out there right now.” No doubt the arguments in favor of the Jones Act resonate with Trump’s protectionist instincts – i.e., ‘if aid is going to be shipped out of American ports, it should be done by American ships!’ But even if you think the benefit to American shipbuilders was worth the additional cost to consumers, this is an emergency, and the people of Puerto Rico need every ship available to be mobilized.

Oprah Winfrey, Needs, Wants, and 2020

There was a time when John Podhoretz’s suggestion that the Democratic party should nominate Oprah Winfrey for president in 2020 could be dismissed as a joke, click-bait, or a silly pipe dream.

But Al Franken is a senator, Donald Trump is president, Republicans are hoping Kid Rock runs for Senate in Michigan and Tennessee Republicans hoped Peyton Manning would run for Senate in their state. (Yesterday Manning denied any interest in being a politician; no word on whether he issued the denial in the sing-song-y tone of the Nationwide-Is-On-Your-Side jingle.)

Podhoretz:

If you think that Trump can be beaten by a two-term governor of a Midwestern state with really good ideas about health care, or by a senator who really attracts young people, think again. The idea that a relatively conventional elected official will differentiate herself from Trump by dint of her seriousness or that an unconventional elected official can out-populist Trump is crazy.

If you need to set a thief to catch a thief, you need a star — a grand, outsized, fearless star whom Trump can neither intimidate nor outshine —  to catch a star. We’re through the looking glass here. America is discarding old approaches in politics. Democrats will have to do the same to match the mood to the moment.

I would argue that outside of Ronald Reagan, who had transitioned to the realm of politics much earlier in his career, the record of celebrity officeholders is a generally depressing one, looking in particular at Governors Arnold Schwarzenegger and Jesse Ventura.

(Fred Thompson is one of those unusual cases where he began in politics (minority counsel for the Senate Watergate Committee, special counsel to the Senate Foreign Relations Committee and Intelligence Committee), then started acing in the late 80s, then was elected to the Senate in 1994. Sonny Bono was a good and kind man, but I don’t know if anyone would consider him a legislative giant.)

The skills of a movie or television star translate well to campaigning, but not necessarily to governing. No doubt Schwarzenegger meant well and wanted to deliver the best possible results for his state, and his efforts were . . .  er, Herculean? But the Democrat-controlled state legislature was intractable, voters rejected his referendums on reform proposals at the ballot box, and he ended his time as governor taking the centrist path of least resistance. By the time he left office in 2011, as the Great Recession was hitting California hard, his approval rating was just 23 percent.

Voters are demonstrating that they want exciting, charismatic faces that they know from non-political contexts. But I’m not sure that’s what they need. Pick your measurement of good governance at the state level: low unemployment, good environment for business, low crime, good schools. Wherever you find the results that please you the most, the odds are low that you’ll find a celebrity-like figure governing that state.

If our measuring stick is whether people feel like they’re governed well, Americans are most pleased with the governors who are anti-celebrities, largely unknown outside of their states. As of July 2017, the most popular governors in America are Charlie Baker of Massachusetts, Larry Hogan of Maryland, Matt Mead of Wyoming, Doug Burgum of North Dakota, and Dennis Daugaard of South Dakota. (Also note, the top ten most popular governors in America are all Republican.) The least popular right now is also one of the best known, and who has popped up in celebrity contexts like late-night talk and comedy shows, New Jersey’s Chris Christie.

This isn’t to say Podhoretz is wrong, and that Democrats wouldn’t maximize their likelihood of victory with a celebrity candidate to challenge a celebrity president. We need a lot of things that we don’t necessarily want: exercise, green vegetables, saving for a rainy day, to watch mindless television less and to read more . . . 

But how often do we choose what we need over what we want?

ADDENDA: Over on the home page, I write that no Republican should be particularly surprised that Trump is relishing public fights with professional athletes while his legislative agenda moves slowly. This is the presidency that he promised Republican primary voters, and this is the option they chose.

The Morning Jolt

By Jim Geraghty