The annual federal budget debate typically doesn’t excite many folks outside the Washington beltway. And with good reason – the Republican budget process is intended to lull the public to sleep by staying short on details and long on damaging provisions that will hurt low-income and middle-class families.
But folks should pay attention to the debate because budgets have consequences – and if done right, they can truly move our country forward. The “People’s Budget,” which we both helped prepare, is a bold and responsible alternative to the Republican plans that take from working families while giving more to corporations and the wealthy.
The GOP budgets proposed in Congress would cut about $5 trillion over the next decade. The overwhelming burden would fall on programs that boost working families: education, Medicare and Medicaid, college aid, job training, medical research and rebuilding roads and bridges. Tens of millions of Americans would lose health insurance and millions more would lose food stamps or be priced out of college.
Republicans push these devastating cuts as a path to a balanced budget. But their budgets have been widely panned by experts as being based on “magic asterisks.” While they’re comfortable putting the squeeze on working families who will be most affected by these cuts in benefits and services, they refuse to ask corporations and the wealthy to contribute one thin dime to the effort. In fact, not one tax loophole is closed by their budgets.
Instead, the House GOP’s proposed budget would give bigger tax cuts to the wealthy, blowing a $1 trillion-plus hole in the budget over the next decade, according to the Center on Budget and Policy Priorities.
Not surprisingly, neither Republican budget details their top priority: tax reform that would result in an even bigger giveaway. That’s because the public doesn’t support their wish list and because their numbers don’t add up.
Their goal of reducing the top tax rates paid by the rich and corporations by about one- third will cost another $3 trillion, based on the plan they offered last year. Republicans have proposed no credible plan to pay for those tax breaks. The average millionaire would cut his tax bill by $200,000. And it would do nothing to end the scandal that hugely profitable corporations – General Electric, Boeing, Verizon and scores of other companies – paid no federal income taxes over a recent five-year period.
In stark contrast, the “People’s Budget: A Raise for America”—authored by the Congressional Progressive Caucus with assistance from the Economic Policy Institute Policy Center—invests in our nation in a robust, straightforward way. It would create millions of- jobs, repair our crumbling roads and bridges, make college affordable, improve our schools and other community services, and get us to full employment in two years.
Where does the money come from? No “magic asterisks” here—wealthy households and big corporations are finally asked to pay their fair share.
Corporations would no longer get a tax break when they shift jobs and hide profits offshore. Income generated from investments primarily owned by the wealthy would no longer be taxed at a lower rate than income earned from weekly paychecks. Wall Street gamblers would pay a tiny tax on all their wheeler-dealer trading. Millionaires and billionaires would pay somewhat higher tax rates (but still lower than they did during most of the Reagan Administration).
Average Americans are hungry for this kind of responsible reform. They know the tax code is stacked against them in favor of the well-off and well-connected. In a recent Pew Research Center poll, over 60 percent of respondents said their top complaint about the tax system was that corporations and the wealthy don’t pay their fair share, while only 27 percent were most concerned about their own tax bill.
Budgets are about choices. Republicans have chosen in their budgets to further enrich the wealthy and corporations at the expense of workers, children, veterans, seniors—the whole broad American family. In contrast, the People’s Budget gives all of us a reason to mobilize around a vision for our future that will expand opportunities for everyday Americans.