Robert Reich Put This Myth About Donald Trump to Rest
By:
Donald Trump is commonly described as a "populist" candidate fighting for working class Americans. But his revised tax reform agenda, which the Republican presidential nominee unveiled on Thursday, casts doubts on that claim, former Secretary of Labor Robert Reich said.
AP/Gerald Herbert - apimages.com
Reich pointed to three policies Trump put forward at a campaign event that would benefit the very wealthy.
1. Knock the top tax rate on businesses down from 35 percent to 15 percent.
2. Eliminate the estate tax – now paid by families worth more than $5.5 million. This will cost $270 billion over the next decade. (It’s also good for Trump personally. If he’s worth as much as he says he is, it would give his heirs tax breaks of $4 billion to $7 billion.)
3. Let global corporations pay just a 10 percent tax rate on untaxed offshore profits. (A similar tax amnesty was tried in 2004, and it generated almost none of the new investments promised.) Apple, Pfizer, Microsoft, and other giant American corporations hold $2.4 trillion in earnings abroad. They owe some $700 billion in taxes on these earnings. Trump’s 10 percent tax rate would only raise about $150 billion.
Business leaders in attendance at Trump's economic policy speech cheered his proposed business tax cut, Slate's Jordon Weissmann wrote. And Trump acknowledged, "I know that's what you've been waiting for."
But the takeaway here is that Trump's plan would cost about $4.4 trillion, with most benefits going toward the wealthiest Americans, Reich said.
That appears at odds with the campaign's promise to protect the interests of working class citizens. The tax reform plan included a child care deduction for "[all] but the wealthiest Americans," but the other policies he outlined — including the elimination of the estate tax and a 10 percent tax rate for untaxed offshore profits — are unlikely to affect most of the "working class."
In contrast, Clinton's tax reform plan includes proposals to add a 4 percent surtax on incomes above $5 million and raise the top estate tax to 45 percent, according to the Tax Foundation.
"Make no mistake," Reich wrote. "This is the same old supply-side trickle-down economics in a new, more narcissistic bottle."
