Among the biggest headlines this past week were House Speaker Nancy Pelosi’s decision to frequent a hair salon and an Atlantic article quoting anonymous sources claiming President Donald Trump disparaged the military.
The headlines are often distractions, lacking in substance.
Very few articles have been written about presumptive Democrat nominee Joe Biden’s tax plan.
We can talk all we want about some of the crazy things that President Donald Trump tweets. However, what is even crazier is that a candidate for president would actually propose a plan that kills jobs and produces a decade of stagnant wages.
And yet, that’s exactly what Biden’s plan would do.
And the media has largely ignored the details of the plan.
According to the Tax Foundation analysis, Biden’s plan would:
- Cause GDP to decrease by 1.5%. This may not sound like a lot, but consider that in 2009 GDP decreased by 2.5%, and it was a very painful time for many.
- Eliminate 585,000 jobs. These often affect the lower skilled and neediest among us that get hurt most when jobs are lost.
- Reduce after-tax income to all income groups, including the lowest income.
There are more details to the plan, including some child care tax credits and incentives for small businesses to increase retirement savings accounts. However, any tiny benefit is wiped out by the fact incomes will drop over the next decade. If we measure income in real dollars, then expect your wages to plummet. In other words, your income will stay stagnant or perhaps even decline while the cost of living increases.
Liberals often decry the wealth and the income gap, claiming that the wealthy need to bear the brunt of additional income taxes. Biden’s plan does in fact lower the after-tax income of the richest more than it lowers the after-tax income of the poorest. The Tax Foundation states that it would lower the after-tax income for the poorest by 7.8 percent and 0.6 percent for the lowest fifth. However, the richest can afford a 7.8 cut in pay. The poorest cannot afford their income to drop at all.
To date, incomes have increased every decade since the 1950s. And Americans’ incomes need to grow to maintain the cost of living.
A decrease in income over the next decade while half a million Americans lose their work and their dignity will cause tremendous hardship and pain for our country. Many upper middle income workers with college degrees, connections, or privilege might be OK. But those in poverty and those trying to work their way toward a better future will be brought down.
Biden’s tax plan would not increase taxes as much as Bernie Sanders had proposed. However, it would still be a major hardship for the country. We need to spend more time studying the tax plans and the policies of the candidates and less time acting as though an election is a popularity contest.