Biden infrastructure/tax increase megathread

[ProgressiveModerate]

Part of what's frustrating about Manchin and Sinema is their holes in Democratic support tend to be on opposite issues, with Manchin being more conservative on social issues and climate change while Sinema tends to be more conservative on economic and regulatory things. And I don't really care that they may not being 100% in line with all my values but both of them need to be more upfront about what they want.

Let's see how things unfolds and if this fails due to Sinema specifically she is dead politically come 2024.

[SnowLabrador]

Part of what's frustrating about Manchin and Sinema is their holes in Democratic support tend to be on opposite issues, with Manchin being more conservative on social issues and climate change while Sinema tends to be more conservative on economic and regulatory things. And I don't really care that they may not being 100% in line with all my values but both of them need to be more upfront about what they want.

Let's see how things unfolds and if this fails due to Sinema specifically she is dead politically come 2024.

I'm not so sure about that. Also, Manchin and Sinema don't have any actual desires for the bill. They're just determined to sabotage Biden's agenda for the $$$$.

[Alben Barkley]

I told everyone that it wouldn't pass. Being right sucks.

How would you know what being right is like?

Anyway, if you actually read the article, the bill’s not even dead. Sinema has not actually come out as a No, she’s just leveraging her position it seems.

[H.E. VOLODYMYR ZELENKSYY]

Sinema is so much worse than Manchin because she doesn't even have the excuse of representing a hyper-conservative state. This is just who she is.

The worst part is that it’s literally not. Remember when she was a Green Party activist? She just doesn’t have principles.

[certified hummus supporter 🇵🇸🤝🇺🇸🤝🇺🇦]

Inshallah, it will be a glorious day when she loses her primary to the gigachad Ruben Gallego

[Alben Barkley]

Why is anyone surprised? Democrats are not economically literate

Lol, coming from the party that gave the wealthy a welfare handout tax break for no reason during a good economy because Paul Ryan strokes it to Ayn Rand or something. Meanwhile the best the economy has ever been was under Democratic rule in the 90s.

[Pericles]

She could just get that $14 billion private equity thing taken out to feel powerful and the rest of the bill would be intact.

[OSR stands with Israel]

Why is anyone surprised? Democrats are not economically literate

Lol, coming from the party that gave the wealthy a welfare handout tax break for no reason during a good economy because Paul Ryan strokes it to Ayn Rand or something. Meanwhile the best the economy has ever been was under Democratic rule in the 90s.

Yes under a Dem President that accepted Reagan's economic consensus and passed policies such as NAFTA, Capital Gain Tax Cuts, did deregulation, passed welfare reform etc.


Also the 2017 tax cut was a great bill as that made our corporate tax rates more in line with the rest of the world, and gave a huge tax cut for small businesses as well. The only problem with it is the darn freedom caucus ensured Ryan's Border Adjustment tax wouldnt be in the bill

[certified hummus supporter 🇵🇸🤝🇺🇸🤝🇺🇦]

I thought you were concerned about inflation.

Yes and to reduce it we need to increase aggregate supply

Agreed, but we also need to decrease aggregate demand at the same time as well.

[SnowLabrador]

I told everyone that it wouldn't pass. Being right sucks.

How would you know what being right is like?

Anyway, if you actually read the article, the bill’s not even dead. Sinema has not actually come out as a No, she’s just leveraging her position it seems.

This is how it always is with Manchin and Sinema. They should be kicked out of the party, and I don't care if it gives McConnell Senate control a few months early. They already served their purpose of confirming KBJ.

[wesmoorenerd]

Sinema was already dead in 2024. If she's a no on reconciliation that just tightens the noose even further.

Worst D member of Congress. Several tiers worse than Manchin, Gottheimer, Cuellar, and Schrader.

[Darthpi – Anti-Florida Activist]

Sinema is so much worse than Manchin because she doesn't even have the excuse of representing a hyper-conservative state. This is just who she is.

The worst part is that it’s literally not. Remember when she was a Green Party activist? She just doesn’t have principles.

I mean, I mostly meant that she was a deeply unserious political figure, not that she was consistently conservative, so yeah.

[parochial boy]

Great plan. An under discussed point is the degree to which households, and especially higher income ones, were able to save during the pandemic. And the degree to which having the ability to spend these savings at the time of still restricted supply has contributed to the overheated demand driving inflation.

In that respect, if you want to use fiscal policy to address inflation it makes perfect sense to tax higher income households more heavily in order to reduce their demand. As them having less money will be far less painful than the impact of other policies like reducing public spending or welfare cuts that would otherwise hurt the already struggling people on lower incomes or the sorts of public investments that are needed for long term economic health.

[ProgressiveModerate]

Part of what's frustrating about Manchin and Sinema is their holes in Democratic support tend to be on opposite issues, with Manchin being more conservative on social issues and climate change while Sinema tends to be more conservative on economic and regulatory things. And I don't really care that they may not being 100% in line with all my values but both of them need to be more upfront about what they want.

Let's see how things unfolds and if this fails due to Sinema specifically she is dead politically come 2024.

I'm not so sure about that. Also, Manchin and Sinema don't have any actual desires for the bill. They're just determined to sabotage Biden's agenda for the $$$$.

She would not survive a 1 v 1 primary without an absolutely massive effort by Republicans to get their voters to cross over and vote for her in a primary which is very unlikely. Her best hope is she faces like 3 credible Dem challengers in a primary and hence wins by plurality.

[GM Team Member and Acting PPT WB]

Part of what's frustrating about Manchin and Sinema is their holes in Democratic support tend to be on opposite issues, with Manchin being more conservative on social issues and climate change while Sinema tends to be more conservative on economic and regulatory things. And I don't really care that they may not being 100% in line with all my values but both of them need to be more upfront about what they want.

Let's see how things unfolds and if this fails due to Sinema specifically she is dead politically come 2024.

I'm not so sure about that. Also, Manchin and Sinema don't have any actual desires for the bill. They're just determined to sabotage Biden's agenda for the $$$$.

She would not survive a 1 v 1 primary without an absolutely massive effort by Republicans to get their voters to cross over and vote for her in a primary which is very unlikely. Her best hope is she faces like 3 credible Dem challengers in a primary and hence wins by plurality.

Even then iirc polls with her, both Gallegos and Stanton running has Sinema in like 3rd

[MillennialModerate]

Shocking.

It’s clear she has no interest in being Senator beyond 2024.

If she did she’d vote for this

[ProudModerate2]

Uggggggg.
I'm sick of this crap.

[Benjamin Frank]

Since, I was asked to comment on this:
1.Doug Andres is Mitch McConnell's press secretary, that shouldn't be hidden either.

I have no idea. While I respect the JCT is nonpartisan, the only direct tax increases are the minimum corporate tax rate of 15% and the taxation of the carry forward provisions used by Wall Street fat cats.

I have no idea what assumptions were used by the JCT for them to arrive at their conclusions and I have no idea their related calculations.  Given that, I don't have anywhere near enough information to comment on their conclusions (and nor does anybody else.)


In general:
I'd assume that their assumptions include that the corporate minimum tax will be passed on to consumers. Normally, that would probably be a fair point, however, given the inflation, if this legislation (should it pass) results in net lower inflation and then in meaning that the Federal Reserve and the private banks don't have to raise interest rates as much, for the vast majority of consumers, that should greatly outweigh any tax increase.

So, even assuming their assumptions are anywhere near accurate, their calculations don't take into account the 'second order' effects of these tax increases on possibly reducing inflation and therefore interest rates as well (or meaning that interest rates would not have to be raised as high as they would have to be otherwise.)

That is, for instance, the argument Larry Summers made in favor of this legislation.

I think there are some good comments here, but I'm disappointed not a single previous poster asked 'how did they arrive at these numbers?"

I appreciate that economic forecasting has gotten better thanks to 'big data' and 'analytics' an the older econometrics has a lot of big brains, but economic forecasting is still something of the dark sheep of the economics profession.

[Benjamin Frank]

Why is anyone surprised? Democrats are not economically literate

Lol, coming from the party that gave the wealthy a welfare handout tax break for no reason during a good economy because Paul Ryan strokes it to Ayn Rand or something. Meanwhile the best the economy has ever been was under Democratic rule in the 90s.

Yes under a Dem President that accepted Reagan's economic consensus and passed policies such as NAFTA, Capital Gain Tax Cuts, did deregulation, passed welfare reform etc.


Also the 2017 tax cut was a great bill as that made our corporate tax rates more in line with the rest of the world, and gave a huge tax cut for small businesses as well. The only problem with it is the darn freedom caucus ensured Ryan's Border Adjustment tax wouldnt be in the bill

1.You left out that Bill Clinton and Congress passed for $500 billion in tax increases and spending cuts (on top of George H W Bush's $500 billion tax increases and spending cuts) in order to get Reagan's enormous budget deficits under control. Budget deficits that were wreaking havoc on the economy by causing very high long term interest rates (very high relative to short term interest rates.)

2.You also left out that the Capital Gains tax cuts possibly (I'd argue 'probably' to 'definitely' but there is no consensus) led to the tech meltdown of 2000 and contributed to the Financial Meltdown/Great Recession of 2008.

3.Do you know what a 'border adjustment tax' is? It's a tariff on imported products, which would have meant a tax increase for pretty much every American.

There are proposed border adjustment taxes on imports on nations that won't increase carbon taxes for instance. This 'boarder adjustment tax' was nothing more than tariffs (tax increases) on foreign imports.

[Hammy]

Biden needs to go hard on the offensive over this bullsh**t when people claim "look Dems have the Senate and they get nothing done, only Republicans can get things done"

Sinema is definitely on somebody's payroll--part of me can't help wonder if this is revenge for the Green party throwing a tantrum over their candidate getting thrown off the NC ballot for not following the rules literally everyone else has to. Collins already admitted Republicans are doing the same thing, refusing other things they supported a few weeks ago purely out of spite.

[ProgressiveModerate]

Also I'd be genuinely curious to be inside Sinema's brain. Her political transition from ultra-progressive to moderate and stubborn is interesting to follow, and it does seem like between the Trump and Biden admin, she lurched slightly right as a Senator. Also rmbr on a lot of key votes for judicial nominees and stuff she's pretty reliable for Dems, it's mostly on big stuff.

She also seemed like a very genuine and passionate person when she was in the state assembly and even as congresswoman yet nowadays many see her as bought and it can be hard to tell. Also being a Senator inherently makes you a bit out of touch with the rest of society itself.

It seems like many, especially progressive Dems believe she's purposely just screwing things up because she has the power to do so, but I doubt that is the case, though she could have flimsy morals.

Also it's important to note unlike Manchin, she doesn't have too many holes with most mainstream/popular Dem policies, it's really her opposition to change the filibuster to vote for stuff and her obsession with economic aspects of how to pay for things that sets her apart.

In this case, she's not saying she's def a no and while it may be frustrating to many Dems, there's nothing inherently wrong with asking for modification to a bill made by 2 Senators, however, you actually need to voice your concerns and provide clear alternative.

I'm conflicted because I really don't know whether on the inside she is sticking to her true values or is operating in bad faith (or perhaps both).

[OSR stands with Israel]

Why is anyone surprised? Democrats are not economically literate

Lol, coming from the party that gave the wealthy a welfare handout tax break for no reason during a good economy because Paul Ryan strokes it to Ayn Rand or something. Meanwhile the best the economy has ever been was under Democratic rule in the 90s.

Yes under a Dem President that accepted Reagan's economic consensus and passed policies such as NAFTA, Capital Gain Tax Cuts, did deregulation, passed welfare reform etc.


Also the 2017 tax cut was a great bill as that made our corporate tax rates more in line with the rest of the world, and gave a huge tax cut for small businesses as well. The only problem with it is the darn freedom caucus ensured Ryan's Border Adjustment tax wouldnt be in the bill

1.You left out that Bill Clinton and Congress passed for $500 billion in tax increases and spending cuts (on top of George H W Bush's $500 billion tax increases and spending cuts) in order to get Reagan's enormous budget deficits under control. Budget deficits that were wreaking havoc on the economy by causing very high long term interest rates (very high relative to short term interest rates.)

2.You also left out that the Capital Gains tax cuts possibly (I'd argue 'probably' to 'definitely' but there is no consensus) led to the tech meltdown of 2000 and contributed to the Financial Meltdown/Great Recession of 2008.

3.Do you know what a 'border adjustment tax' is? It's a tariff on imported products, which would have meant a tax increase for pretty much every American.

There are proposed border adjustment taxes on imports on nations that won't increase carbon taxes for instance. This 'boarder adjustment tax' was nothing more than tariffs (tax increases) on foreign imports.

1. Yes and it was balanced our with capital gain tax cuts. Reagan did the opposite where he cut income tax rates but balanced it out by raising capital gain rates.

2. I would say it was a problem more of the Federal Reserve keeping interest rates as low as they did in the 2000s

3. Yes the point was to cut the corporate rate from 35% to 21% but have a BAT to basically incentivize companies to create jobs here in the US instead of abroad. Actually I read it was Trump who killed it cause he wanted to use Tariffs as leverage for a deal while Ryan more or less wanted it for this purpose plus to make the tax cut revenue neutral . Here was how it was supposed to work

If each company records $50 in supply costs and $100 in revenues, each records a $50 annual profit. Based on the nation’s current tax system, the three companies would each pay a 35% tax on profits, or $17.50.

With a BAT however, the calculus shifts. Whereas previously our three companies each paid the same taxes, export tax exemptions and tax adjustments to imports would change each company’s after-tax balance. (Note: the following calculations solely take U.S. taxes and economic shifts into account.)

Say an export-reliant company gains all its revenues from foreign sales, and imports no supplies (its $50 costs are domestic). While this company still reports $50 in profits based on its cash flow, the business would receive a 100% tax exemption for its export-based revenue. As a result, the company would qualify to pay less in U.S. taxes, in this case bringing tax obligations to a net zero.

Meanwhile, the import-reliant company sells all its products in the U.S., but imports all its supplies. Under the BAT, this company would still report $50 in profits, but pay an additional 35% tax on its costs, effectively doubling the tax burden to $35. (Previously, both the importer and exporter paid $17.50 in taxes.)

https://www.supplychaindive.com/news/border-adjustment-tax-how-supply-chain/435482/

[Inmate Trump]

I can’t wait for this idiot diva to be out of office.

She and Manchin are a large part of why Biden’s approval has tanked.

[Inmate Trump]

Why is anyone surprised? Democrats are not economically literate

Republicans are not democracy literate.

Actually, no, that’s not right. You guys are democracy literate…you just don’t support democracy anymore.

[Fuzzy Bear]

Worth noting for context before cons start clutching pearls over this, half of the tax increase falls on the lowest 98% of the population.

The thread goes further: 87% will fall on those making over 100k, each means the bottom 75% will be paying 7% of this bill.

Which means people making less than 100k will still be paying more in taxes

People?  Or Households?