Senator Marco Rubio is taking a swipe at the Trump tax cuts (tax cuts he voted for, we should remember) saying that they’re too helpful to corporations and not helpful enough for rank-and-file Republicans:
“There is still a lot of thinking on the right that if big corporations are happy, they’re going to take the money they’re saving and reinvest it in American workers,” Rubio told The Economist in an interview published Monday. “In fact they bought back shares, a few gave out bonuses; there’s no evidence whatsoever that the money’s been massively poured back into the American worker.”
This might be the most forceful example of Rubio making this point, but it’s not the first time he’s made it. “If I were king for a day, this tax bill would have looked different,” he said back in December. “I thought we probably went too far on (helping) corporations. By and large, you’re going to see a lot of these multinationals buy back shares to drive up the price. Some of them will be forced, because they’re sitting on historic levels of cash, to pay out dividends to shareholders. That isn’t going to create dramatic economic growth. (But) there’s a lot of things in the bill that I have supported for a long time (such as) doubling the Child Tax Credit. And it is better – significantly better – than the current code.”
Rubio is saying the bill is an improvement overall on the previous tax code, but too friendly to corporations.
That’s debatable, but politically speaking Rubio’s criticism is likely a boon for Democrats campaigning in red states like North Dakota. Just today I had Democratic U.S. House candidate Mac Schneider on my radio show, and his comments about the Trump tax cuts are pretty much indistinguishable from Rubio’s.
“I think there’s some parts of that tax code that I strongly support,” Schneider told me (audio below). “If you take a look at the doubling of the standard deduction. The middle class tax cuts. Some of the small business deductions. those are all good things. My concern is that the center piece of this is the large tax cuts to corporations who least need a tax cut.”
I’m not sure I buy this rhetoric about tax cuts for corporations being of little utility to middle class and lower income Americans. Even if we set aside the question of whatever investments or bonuses the corporate world as done as a result of the tax cuts, how about the fact that millions of middle class Americans are invested in those corporations? Millions of Americans are also customers of those corporations, and can enjoy a more robust marketplace as a result of a tax code that’s more competitive.
And speaking of competitive, how about the realities of a global marketplace? Let’s not forget that one of the resonating messages of President Trump’s campaign is the idea that America’s not competitive on the global stage. A lot of the rhetoric around that issue has focused on our country getting raw deals on trade, but how about the raw deal we give ourselves with a byzantine tax code punctuated with corporate tax rates that are among the highest in the world?
It may be good populist rhetoric to deride tax cuts for corporations, but as policy it makes sense.
Also complicating the Rubio/Schneider talking points is that many middle class Americans really are seeing a direct benefit from the tax cuts. A recent Reuters poll found that Democrats are losing ground among younger voters, in part because younger voters like the tax cuts:
Terry Hood, 34, an African-American who works at a Dollar General store in Baton Rouge, Louisiana and took this year’s poll, said he voted for Democrat Hillary Clinton in the 2016 presidential election.
But he will consider a Republican for Congress because he believes the party is making it easier to find jobs and he applauds the recent Republican-led tax cut.
“It sounds strange to me to say this about the Republicans, but they’re helping with even the small things,” Hood said in a phone interview. “They’re taking less taxes out of my paycheck. I notice that.”
I think a lot of people are noticing that.
Still, for Democrats like Schneider hoping to chalk up victories over Republicans in red states like North Dakota, Rubio’s comments are a lifeline. It’s going to be hard for Republicans here to write off Schneider’s criticisms of the tax reform as the rhetoric of another liberal Democrat when it sounds just like what one of the most prominent Republicans in the country is saying.
[fcc_jw_podcast key=”9b5W6QgV” /]