Trickle Downers

The Prospect's ongoing exposé of the folly, dysfunctions, and sheer idiocy of feed-the-rich economic policies.

Tax Cuts for the rich. Deregulation for the powerful. Wage suppression for everyone else. These are the tenets of trickle-down economics, the conservatives’ age-old strategy for advantaging the interests of the rich and powerful over those of the middle class and poor. The articles in Trickle-Downers are devoted, first, to exposing and refuting these lies, but equally, to reminding Americans that these claims aren’t made because they are true. Rather, they are made because they are the most effective way elites have found to bully, confuse and intimidate middle- and working-class voters. Trickle-down claims are not real economics. They are negotiating strategies. Here at the Prospect, we hope to help you win that negotiation.

Trickle Downers

$2 Trillion Here, $2 Trillion There, and Soon We’re Talking Real Money

I know you know that Republicans throw money at the rich. Doctrines may shift, Russia may go from bad guy to BFF, NATO may defend the free world one day and dilute our sovereignty the next, but tax cuts for the rich are the one True North of Republican cosmology. Without it, the party perishes, not only from diminished campaign contributions but from lack of raison d’être.

As to just how much money Republicans throw at the rich, the nonpartisan Institute on Taxation and Economy Policy (ITEP) released a report last month that’s gone largely unremarked in the media but that makes starkly clear just how faithful a friend and lapdog the GOP has been to our wealthiest friends and neighbors. What ITEP did was to total up all the tax reductions to the rich enacted since George W. Bush became president in 2001, subtracting from that total the restoration of higher tax rates on the rich that went through under President Barack Obama.

Here are the numbers: Since 2001, the income tax cuts for the wealthiest 1 percent come to $1,366 billion. The estate tax cuts for the wealthiest 1 percent come to $838 billion. Subtract from these cuts the hikes on the wealthiest 1 percent enacted during the Obama intermission, and we have a grand total of $1,924 billion that the wealthiest have been able to pocket for their rainy day funds.

I think that’s close enough that we can round it up a bit to an even $2,000 billion—which, for those of you who’ve been counting the zeros, is actually $2 trillion.

And that doesn’t count, of course, the additional $100 billion in cuts to capital gains taxes that the administration now says it plans to implement administratively by changing how it calculates the initial value of investments. That $100 billion, too, would flow chiefly to that same 1 percent.

But back to that $2 trillion: By a curious coincidence, that was also the amount that the administration proposed to save in its (mercifully, not very enactable) 2019 budget by reducing spending on Medicaid ($1.4 trillion), Medicare ($530 billion) and Social Security ($25 billion)—which comes in at a cool $1.955 trillion. As with the tax cut to the 1 percent, let’s just round that to $2 trillion, too.

So: Republican presidents and congresses have cut the taxes of the 1 percent by $2 trillion over the past 17 years, and Trump has now proposed to cut spending on Medicaid, Medicare, and Social Security by the same $2 trillion.

Democratic campaign consultants, do with this what you will.

Tax Cuts for the rich. Deregulation for the powerful. Wage suppression for everyone else. These are the tenets of trickle-down economics, the conservatives’ age-old strategy for advantaging the interests of the rich and powerful over those of the middle class and poor. The articles in Trickle-Downers are devoted, first, to exposing and refuting these lies, but equally, to reminding Americans that these claims aren’t made because they are true. Rather, they are made because they are the most effective way elites have found to bully, confuse and intimidate middle- and working-class voters. Trickle-down claims are not real economics. They are negotiating strategies. Here at the Prospect, we hope to help you win that negotiation.

How SNAP and Medicaid Work Requirements Will Hurt Workers

The problem isn’t that people don’t want to work. It’s the volatile and unstable nature of the low-wage labor market.

(AP Photo/J. Scott Applewhite)
(AP Photo/J. Scott Applewhite) Republican Representative Dave Brat of Virginia has been promoting work requirements for SNAP recipients. trickle-downers.jpg O n any given day, you’re likely to interact with a lot of people who work in the low-wage labor market. They’re the laborers you pass on the street, the retail clerks in a shop you frequent, the cooks or wait staff at a restaurant you like. They might be your family, friends, and coworkers. Maybe you yourself work in one of these occupations—after all, many millions of Americans do. While conservatives might paint adults who receive Supplemental Nutrition Assistance Program (SNAP, commonly called food stamps) benefits and Medicaid as idle people who don’t want to work, the data don’t validate that assumption. Adults who rely on SNAP and Medicaid for help paying for their groceries and health care are often those same low-wage workers. But their work is largely volatile and unstable, and it comes without such key work supports as...

Republicans’ ‘Tax Reform 2.0’ Would Be (Another) Giveaway to the Rich

By expanding the scope of 529 savings accounts, the GOP gives the wealthy another way to cut their taxes.

(AP Photo/Jacquelyn Martin)
(AP Photo/Jacquelyn Martin) House Speaker Paul Ryan closes the door before speaking at a news conference after a Republican caucus meeting on July 24, 2018. trickle-downers.jpg W ith midterm elections quickly approaching, House Republicans have bet on tax cuts as their ticket to remaining in power in November. Now, they’re doubling down on that bet. On Tuesday, GOP members of the House Ways and Means Committee released a two-page policy outline for a second round of tax cuts to build on and draw attention to what they believe to be the still unnoticed virtues of their landmark tax act passed in December, which has lost popularity with voters in the past few months. The "tax reform 2.0" would make permanent various (mostly regressive) individual tax breaks included in the Tax Cuts and Jobs Act that were set to expire in 2025 as well as offer a variety of retirement and family saving incentives. The value of one such incentive, the 529 College Savings Accounts, depends entirely on the...

Workers Strike and Promote Boycotts on Amazon Prime Day

The online retail giant had an eventful Prime Day, with strikes, boycotts, demonstrations—and of course, billions of dollars in profit.

AP Photo/Mark Lennihan, File A clerk reaches to a shelf to pick an item for a customer order at the Amazon Prime warehouse in New York. trickle-downers_35.jpg O n that most sacred of retail discount days, Prime Day, Amazon’s profits continued to soar—but not without its employees attempting to improve their working conditions, and a host of groups calling attention to how far Amazon is willing to go to retain its market dominance. On Prime Day—which was this past Tuesday and so extensively covered by the media that Amazon reaped a further fortune in free advertising—the company made roughly $3 billion in sales and added more Prime members to its lists than on any previous day. But even as Prime members—who pay $119 each year for the membership that includes shipping fees, streaming services, and other benefits—were chasing deals, thousands of Amazon workers across Europe were striking, and activists in several countries launched a consumer boycott. Other groups used Prime Day to...

D.C. Council Members Join Congressional Republicans to Override Voters’ Decision to Raise Tipped Workers’ Wages

District voters passed Initiative 77, but “Freedom Caucus” House leaders and Democrats on the council say the vote shouldn’t count.

Prarinya/Shutterstock trickle-downers_54.jpg T he fight over increasing the tipped minimum wage in Washington, D.C., is making for strange bedfellows. Having long bemoaned congressional Republicans’ habit of meddling in District affairs, a majority of the D.C. Council now find themselves in the uncomfortable position of joining in common cause with two members of the ultra-conservative House Freedom Caucus. The Republican representatives—Mark Meadows of North Carolina, who chairs the Freedom Caucus, and Gary Palmer of Alabama—moved Wednesday to block Initiative 77, a voter-approved ballot measure that would increase the minimum wage for tipped workers in the District. The measure passed with 55 percent of the vote in the June primary elections after a vicious (and expensive) messaging campaign to defeat it. The Freedom Caucus push arrived the day after seven of the council’s 13 members co-introduced legislation to overturn Initiative 77, aligning local Democrats and congressional...

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