None of GOP candidates' tax plans make sense

No one will ever confuse Forbes Magazine for Slate Magazine. Forbes represents conservative, pro-business positions. Slate is somewhat left of center on, well, pretty nearly everything. So it's rather a surprise to see these polar opposites in substantial agreement on anything. But surprise, surprise, after last Wednesday's Republican candidates' debate, their editorial positions converged on one item — not one of the Republicans have a clue about taxes or the federal budget.

The day after the Republicans' shouting match masquerading as a discussion of economic issues, here's what Forbes investment contributor Stan Callender said about it: "They disagreed with nonpartisan analyses that showed their tax plans losing trillions even when those scores were produced using the GOP-preferred dynamic scoring techniques. ... There was nothing that should give anyone any comfort that comprehensive tax reform will happen any time — as in multiple years — soon. And it's hard to imagine how what was said will do anything but fortify the ultra conservatives in the House and Senate and make them even more likely to act as legislative terrorists on anything related to the federal budget." When even the conservatives call out their own candidates' positions as harmful to the economy and adding trillions of dollars (that's trillions, as in "thousands of billions") to the national debt, it's time for people to sit up and take notice.


Slate irreverently titled its summary, "Which Republican Has the Most Delusional Tax Plan?" agreeing only with John Kasich's appraisal of all of the other contenders' tax plans, "These plans would put us trillions in debt. … Why don't we just put a chicken in every pot, coming up with these fantasy tax schemes?"

Just how bad are the Republican candidates' tax plans? Pretty bad. Ted Cruz calls for a 10 percent flat tax and a 16 percent value added tax, essentially a national sales tax, which burdens the lowest-income earners most of all. The effect for the top 0.1 percent is to reduce their effective tax rates from a ridiculously low 26.5 percent to less than 10 percent. So, if you happen to pull in $10 million per year, Cruz will save you more than $1.6 million in Federal income taxes.

Even the conservative Tax Foundation estimates Donald Trump's plan to add $12 trillion to the national debt over a 10-year period and would represent a windfall to the ultra-rich. So when the Donald trumpets that his own plan would "cost me a fortune," he's not being honest with us.

When Ben Carson was challenged on the viability of his tithing plan, a 10 percent flat tax, he quickly backed down and said the actual rate would be closer to 15 percent. Either way, his proposals would cause the national debt to skyrocket, according to the nonpartisan organization, Citizens for Tax Justice, which estimates the plan would raise taxes on the bottom 95 percent of taxpayers by an average of $2,887, while cutting them by an average of $209,562 for the richest 1 percent of taxpayers each year.

It's a sacred cow of conservative orthodoxy that all tax cuts stimulate economic growth. Unfortunately, that dogma isn't completely accurate. Tax cuts can have the stimulating effect of increasing available cash in the economy, but according to a report by the Brookings Institute, for those cuts actually to create economic growth, they need to be financed by spending cuts. And those cuts themselves need to be addressed to avoid windfall gains. This means that reducing taxes for the rich just won't cut it when it comes to spurring economic growth; trickle-down economics is a myth. Data also does not support conventional liberal wisdom that tax cuts stimulate the economy by increasing demand for goods and services. In fact, there is very little relationship between tax rates and economic growth. What does account for changes in the economy, as measured by changes in the gross national product, is monetary policy, a topic markedly absent from all three Republican debates.

Republican candidates say their tax proposals will stimulate the economy and lift American business. But the numbers say otherwise.

Mitch Edelman writes from Finksburg. Email him at