Lord willing, the Trump tax cuts will get final passage this week now that the House and Senate have ironed out their differences. I’ve done the math for my own family, and it looks like we will save several hundred dollars a year in federal income taxes. This is a good thing. But I’ve really got my eye on something else. My real curiosity is how will cutting the corporate tax rate from 35% to 21% affect my 401(k)? Already this past year my personal retirement has grown more than I’ve ever seen it grow, just on the prospect of President Trump’s promised tax cuts. That’s where the real money is to be made.
Naturally, Democrats have demagogued the tax cuts the way they demagogue all tax cuts. I’m not even going to quote them. You know the standard cliches. If not, head over to Bernie’s or Chuck’s or Nancy’s or Pocahontas’ Twitter timelines and see for yourself.
People who pay taxes are going to get their taxes cut. It’s that simple. If you don’t pay taxes, don’t look for a tax cut. (Honestly, if you don’t pay taxes, you ought not be voting, but that’s a topic for a different post.)
It has nothing to do with the wealthy not paying their fair share or “huge corporate giveaways.” Letting individuals keep more of what they earn isn’t immoral (quite the opposite, actually), and letting corporations keep more of their profits isn’t a “giveaway.”
You have to understand something about Democrats. By and large, their constituency has devolved into a collection of victim groups which represent a permanent economic underclass. We’re talking about minorities, illegals, refuterrorists, etc. This is where a good number of their votes come from. These are also the recipients of socialist transfer-of-wealth programs. As long as Democrats can keep them dependent on government, then they can be counted on to vote Democrat. This is why class warfare is so critical to keeping Democrats in power. A person who doesn’t need government doesn’t need liberals. Self-sufficiency is anathema to liberalism.
So Democrats demagogue tax cuts using class warfare, couching their politics in terms of morality and fairness. That rich guy is getting your money, Mr. Democrat Voter. This corporation is screwing its workers and its customers and they can’t be allowed these giveaways that Trump wants. The permanent Democrat underclass typically doesn’t have 401(k) accounts, so they don’t think the same way productive people think. (Again, they shouldn’t be allowed to vote until they start putting skin in the game.) This is like a parent bringing home his paycheck and letting the kids decide how it’s spent.
In addition to the cuts in personal and corporate tax rates, the tax cut legislation contains two additional important provisions. One of these is crucial. It gets rid of the ObamaCare mandate for individuals. The second also has potential long-term impacts. It opens up ANWR for oil drilling. Another win for the good guys.