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Well, before we could pin down a decent analysis of the House of Representatives Tax Cut plan, they passed it. They passed the bill this morning 227 to 205.
It seeks a tax cut of $1.4 trillion – yes trillion – over 10 years, cuts the corporate tax rate from 35% to 20% though without eliminating corporate deductions at all.
However, it does eliminate deductions for ordinary people including the SALT deduction on State and Local Taxes. High-tax states on both coasts would be harmed in paying into the federal system than the states receive back, and adding to that burden by removing the SALT deduction.
This additional tax burden was sufficiently onerous that 8 New York and New Jersey Republican House members voted against it, but still the bill passed.
The Senate Tax plan
When House and Senate bills are at odds, they go to Conference Committee for reconciliation. That will become important, because if the Senate plan passes – it has not yet been up for a vote – it has some very dangerous provisions that, if passed and incorporated into the final bill, will do Americans enormous harm.
“To Promote the General Welfare…”
Our nation has too often lost sight of our obligations to one another. In a world of hyper-individualism and personal accumulation, we are not committed sufficiently to the care of those whom the society has abandoned, kicked to the curb, or cannot help. Now that indifference has moved upward on the economic scale, and the plan erodes many of the social programs we depend upon.
Under budget reconciliation, cuts in one place have to be paid for elsewhere. Tax cuts to the 1% will come out of social spending. While technically Social Security, Medicare, etc. are protected, that protection is not absolute. Still other programs are totally vulnerable to cuts. It’s a disaster waiting to happen.
- Permanent repeal of the Affordable Care Act individual mandate. This is accompanied by loss of subsidies (if you’re not required to have it, the Senate decided you don’t need subsidies, right?)This will leave 13 million people uninsured, an increase of about $2000 for those who remain insured and are older. Raising middle and lower income health insurance rates will help billionaires get major tax cuts.
- Since tax cuts for the rich will create an annual $1.5 trillion deficit, the Statutory Pay-As-You-Go law that requires deficits be paid for will seek other sources of “payment”. These will include deductions for student loans, medical expenses not covered by insurance, larger families. It will also include the part of Medicare that is not protected from PAYGO – about $25 billion per year.
- $300 billion will be cut from Medicaid – Medi-Cal in California. The poorest of the poor, whose health is already not good, will subsidize tax cuts for corporations and the very wealthy. This impacts seniors in nursing homes, homeless people already living on the margins, and low-wage workers whose incomes are too fragile to pay market rate coverage rates.
- There are new work requirements for some plans – ridiculous in the face of the infirm, those on disability, and especially seniors in nursing homes. Many recipients already work – but they’d be scrutinized and stripped of dignity by assumptions of fraud.
But what about tax cuts for the middle class?
In 2021 this Senate bill will raise taxes for households earning $10-30,000, and by 2027 that will include households of $30-75,000. The rationale offered by Senator Orrin Hatch and Senator Mike Crapo is that if you are not required to pay for health insurance, you can afford this tax hike. The sheer absurdity of stating that these two things are benefits boggles the mind. But with health subsidies and those credits gone, the actual tax hike is significant.
We must act against these policies that do so much harm – and do so NOW. This is a “Faithful Five Minutes” to do daily until we defeat these bills.
Please call your Senators at 202-224-3121. If you prefer to write or email, go to: http://www.churchimpact.org/take-action.html
Even if your senators are opposing these cuts, tell your brief story of how this would do you or someone you know real harm. Legislators on our side still need your voice to share with those who are on the fence.
Keep calling or emailing your Representative – they need to hear your opposition to any kind of joint resolution on the House and Senate bills.
Tell friends and family in other states to do the same.
Our rallying point is:
Tax and health justice for the Common Good and for the General Welfare!
NONE of these cuts is acceptable, and we as people of faith call on our elected federal officials to vote against the Senate bill and any such provisions that may arise in a joint bill.
We defeated the elimination of the Affordable Care Act that is hidden within this tax bill. We can and must defeat this Senate plan now!.. All we have worked for and accomplished is at risk – raise your voice now for justice!
Thank you!