To The Daily Sun,
Well, Jim Veverka is at it again with a completely logical letter written with facts twisted to make a point that is completely false.
I’ll start with his third paragraph from his, “Silence from fiscal conservatives as Trump piles up federal deficit.” His opening comment is how terrible it is that the deficit “jumped” by 17 percent to $779 billion. Sounds awful right? I went searching for where Jim got his numbers and found this website: (https://www.usgovernmentspending.com/federal_deficit_chart.html). According to that website the deficit in 2018 was $779 Billion and in 2017 was $665 billion. I did the numbers and ($779-$665/$665) =17 percent. Yup, Jim’s “fact” was spot on! The article also included the numbers for 2009 which was President Obama’s first year in office and here they are. In 2008 the deficit was $458 billion and 2009 was $1,413 billion. Using the same math, President Obama had a “astronomical” increase of 209 percent. Here are the numbers" ($1413-$458/$458) = 209 percent).
There, now I’m doing what the left does time after time and it’s completely dishonest. It’s surgically pulling little pieces of data from a much larger data source to mislead people.
Moving on to his next claim that the $779 billion deficit was the highest in the last six years. Again, Jim is absolutely correct using the same website above. If Jim had gone back 10 years it would have been the 5th highest deficit since the deficit under president Obama in 2009 was $1,413 billion; 2010 was $1,294 billion; 2011 was $1,295 billion and 2012 was $1,087 billion. Again, Jim deliberately omits this data to spin a false narrative.
The last claim in that paragraph was that corporate taxes decreased by 31 percent and the government had to borrow money which increased the deficit. Without his source data I can’t verify his number. I spent some time searching the internet and found (https://www.thebalance.com/current-u-s-federal-government-tax-revenue-3305762). According to “The Balance,” corporate taxes in 2017 were $297 billion and $218 billion in 2018. That comes to a reduction of ($297-$218/$297) = 26.6 percent. Though my percentage is not the same as Jim’s, it’s close enough that I will agree a decrease of $79 billion is significant enough to take notice. I want to remind everyone, however, that the tax cuts “goal” was to stimulate the economy. And it has. If Jim’s hypothesis was correct, then total government revenues would have gone down. Well according to the same website total federal revenues increased from $3.32 trillion in 2017 to $3.34 trillion in 2018.
This letter is getting long but I can’t resist addressing Jim’s claim that the tax cuts are going to the rich. This is the biggest lie since president Obama claimed that Obamacare would save the average family $2,500/year. In my letter (https://www.laconiadailysun.com/opinion/letters/let-me-show-you-how-tax-reform-will-put-money/article_b06adf69-af0f-5b18-8bf7-b806f0bc3b00.html) I used California as an example on how limiting state income tax deductions will increase taxes paid by the rich. Since we don’t have a state income tax I’ll address other key hits to the rich, which is the “local tax” deduction and the home mortgage deduction. I’ll use a hypothetical example that is close to home. Let’s use a “rich” couple that owns a $3,000,000 home on Governors Island and has a $2,000,000 mortgage on that property at the current interest rate of 4.6 percent. Gilford has a property tax rate of 1.726 percent so their property tax would be 3,000,000 X .01726 = $51,780/year. In addition, they would pay $2,000,000 X .046 = $92,000 in mortgage interest. Both under the previous tax law would be fully deductible. Not under the TC&JA. So how much did that couple loose in deductions? I went to HR block (https://www.hrblock.com/tax-center/irs/tax-reform/tax-cuts-and-jobs-act/) and here’s what I found. The max SALT deduction for a married couple is limited to $10,000 dollars so they will have to pay taxes on an additional $51,780-$10,000 = $41,780. The home mortgage interest is limited to a $1,000,000 maximum loan so the couple would have to pay taxes on the interest on the second $1,000,000 which would be $46,000. So, the total would be $41,780+$46,000 =$87,780. Assuming they are in the new top tax bracket of 37 percent the increase in taxes would be $87,780 X .37 = $32,479.
To be accurate, I need to include the reduction the couple will get in taxes due to all tax rates being reduced because it matters and is very relevant to the left's talking point that the rich are getting a tax break because they are. To do that I made an excel spread sheet to compare the difference in taxes based on net income. For this example, I will assume the couple makes $600,000 taxable income. That being the case the couple would receive a $21,461 reduction in income taxes. Offsetting that by the new SALT and mortgage increases the couple would end up paying $32,479-$21,461 = $11,018 more in in federal income taxes. Which is my point.
I apologize for the length of this letter but it frustrates me at how the left ignores facts that are relevant and exaggerates trivial items that are not. The TC&JA was passed to increase the overall U.S. economy. Here is a fact few know but should. The federal government takes in approximately 20 percent of the U.S. GDP in taxes and has for the last 60 years. So, for every trillion dollars the GDP increases the government receives about $200 billion additional revenues to pay for health care, Social Security, welfare, national defense, etc. It’s in both political party’s interest that the economy continues to grow. Unfortunately, only the Republican Party seems to support that. It’s my firm belief that the rich are pouring tens of millions of dollars into Democratic candidates so they will repeal the TC&JA because it will cost them billions as time goes on if they don’t.
I’ll close this letter with a recent Trump quote: “The Republicans create jobs and the Democrats create mobs.” I hope America wakes up before it’s too late.