Discussion: Trump, GOP Roll Out Plan For 'Simple, Fair' Tax Code

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Didn’t we hear something similar about the GOP’s healthcare plan — fair, everything covered, “everyone would be covered…”

Pardon me if I don’t believe you dickheads.


On one of last Week’s CNBC noon shows, a few guys were reacting to a presentation the same day with M’nuthin’ and the public updates on the “tax reform” situation.
The participants were the regulars, one of whom is a “Young person, small account Outreach” guy for an older “private Wealth”–say 5 million account size manager. Another is cheek-by-jowl with the larger hedge-fund guys, including the outfit Mercer worked for, and the big one–SAC–that has been recast after basically getting scuttled by the SEC.
Most important, the guest for the entire hour was Jim Chanos, renowned/notorious for his ability to profit from declines in overpriced stocks.†
In addition to M’nuthin’s presentation but were also familiar with other proposals circulated to lobbyists for the “many sides” of this scrum. These might have come from Congress–no names mentioned there, tho, because as usual, these guys were acting like the lobbyists control everything.
The first thing Chanos said was that we weren’t going to be hearing much from KStreet about lowering the corporate tax rate, because under most of these proposals it’s going to go up.
The only conclusion I can come to is that the Fortune 500 CEOs are reasonably satisfied with the situation, Chanos quoted a “cash rate”=–his term–in the teens(%). If this is true, it’s privately accepted high corporate taxes aren’t hurting our international competitiveness at all, because the rate is comparable to those from The Competition overseas.
Moving along, the Gang more or less agreed that there would be efforts to decrease the rates for two groups who comprised Trump’s ACTUAL CONSTITUENCY. These are: “Boutique” business owners who employ 50 people, and professionals whose businesses are partnerships–subchapter S and LLC. SBA elegible companies are mostly up to 500 employees. Chanos’ business is the kind of partnership the boys were talking about. According to Chanos, this goes to the heart of people who still pay higher rates than the corporations and execs. The rates are governed by “pass throughs**” and the hand-to-hand industry-to-industry, account-type lobbying will be brutal, possibly scuttling changes.
Then there’s the widely-discussed proposal to do away with interest deductibility(mortgage, etc.) to “pay” for the “reform.” There was general agreement, if instituted that not only Real Estate but all asset prices would go down. One of the guys wisecracked that “that’d be illegal.” Seconded.

To summarize, all the stuff M’nuthin’ said, that the talking heads on TV and the 'Net are and will be buzzing around and microanalyzing, in the estimation of Chanos et al, is irrelevant.
Which leaves passing a simple across the board cut–but how much it is and how much if any won’t be for the .0001 richest is the question. If the middle class gets nothing they’ll talk trickle-down or corporate tax, even though it’s bullshit.
With me, these 3-4 guys collectively have more credibility than anyone else I expect to see “weigh in” in the next month. Cohn* knows plenty but he won’t be saying anything to impede the possible legislation.

†-it’s more complicted than this, he’s always net “long”, but that doesn’t affect this topic AFAIK.
*“Stay up, Gary, I’ve got money on ya!”
**Pass-through income is sent from a pass-through entity to its owners. The income is not taxed at the corporate level – it is only taxed at the individual owners’ level. A pass-through entity is a special business structure that is used to reduce the effects of double taxation.-Merriam-Webster.


A national VAT?


As a
proposal, wouldn’t surprise me. There was another discussion today which I’m boiling down for later that likens a lot of this stuff to the Border Tax, i.e. unpassable. Even with presidential leadership which is of course lacking.


At this point do we really need to know the details? Trump’s Razor tells us it’s a massive tax break for the Koch’s and Trumps, The rest is just window dressing and obfuscation.


Tax reform is really really hard. It requires a full talented staff at treasury, very smart hardball politicians in both houses and the white house, public pressure and corporate buy-in.

So lots of reasons reform won’t happen. But really, Trump has no skills in his toolbox for this. So forget it. He’s way out of his league.

Now a tax cut proposal, with no regard for deficits might be fun to watch play out until it blows up. Half the GOP loves these. Cut taxes now and then blame democrats for the deficit and scream for a democratic president to cut spending. But they’ve hammered about the deficit for so long now, I don’t think they’ll move this far.


If this goes down to defeat, it’ll be more than fun to watch. It’ll be priceless.
This might just be enough to send him spinning out of control.
Further out.


The problem is, this issue is not like healthcare. There are no organizations like nurses, doctors, etc., that will speak against it that people will care about or recognize. If Elizabeth Warren, etc., are speaking out, fine, but she’s preaching to the choir. So their egregious lies and claims will go likely go unchallenged.


Have fun with that, boys. If ya can’t get an ACA repeal done, the tax code is even worse


This disaster for America is why Trump wants Senatortoise McConnell to scuttle the filibuster.


In a way, because the stakes are high, and everyone is playing, the opposite is true. There will be tons of noise.

For example, a move against the mortgage interest rate deductions will goose home owners, banks, mortgage backed securities vendors, real estate sales companies, construction companies and retail folks like Home Depot, Lowe’s etc.

Tax reform is a house of horrors and Trump is a 5 year old who is scared of the dark and terrified of clowns.


Pretty short-sighted too. How much of the federal support for Jim Crow would survive the next Democratic administration?


It could be fund to watch, however on the long shot that they can get something passed… shudder Kansas here we come:



Yes only fun if it blows up, for sure.


The estate tax — which is levied on millionaires

This isn’t a criticism of the phrasing, since “deka-millionaires” isn’t exactly the parlance of our times, but just so it’s said: in practice, the estate tax is virtually never triggered without well over $11,000,000 in assets. (And then, of course, only on the portion above $11,000,000.)


Fortunately, lower taxes mean higher growth, so reducing taxes to zero will send economic growth into the Republican stratosphere. Zoom!!


We’ve got enough people pretending to be someone else. We don’t need you to pretend you’re Art Laffer.


If they double the personal exemption, that will mean more people will not pay income tax.

That means the so called 47% will increase…


poor and middle class pay more, rich pay less.