It has achieved none of the things that Republicans promised it would. It didn’t reduce deficits. It didn’t target the middle class. And it didn’t win goodwill with voters.
Yet, for some reason, President Trump wants to do it all over again . . . in the next nine days, no less.
Last week the Treasury Department reported that the federal budget deficit swelled by 17 percent, or $113 billion, from fiscal 2017 to 2018. This is noteworthy, and not only because Republicans usually claim to despise deficits (at least, they do when Democrats are in charge).
It also reflects a massive decoupling of the business cycle from the federal budget.
Usually, as the economy improves, deficits shrink. That’s because people earn more money, causing them to pay more in taxes and enroll in fewer federal safety-net programs. This relationship between deficits and the economy has generally held true for the past 70 years, except during times of war.
Average rates dropped in 2018, but they’ll return to 2017 levels by 2026
15%
14.3%
Tax bill
14
13.4%
13
12
12.1%
11
2024
2025
2017
2018
2019
2021
2023
2026
2020
2022
Source: Source: Tax Policy Center estimates
Note: Average federal tax (includes individual and corporate income tax, payroll taxes for Social Security and Medicare, the estate tax, and excise taxes) as a percentage of average expanded cash income.
And, the cuts for middle-class wage earners fade over time. By 2026, changes to individual tax rules expire, while corporate changes are permanent. Unless Congress acts, 53 percent of all taxpayers will see a modest tax hike by 2027, the Tax Policy Center says, including almost 70 percent of middle-income families.