Muffy NEEEEDS Another TAX CUT!
Pack your bags, kids, it's time for a little CLASS WARFARE! Hooray! Those greedy sumbitches in the White House have figured out a way to let wealthy Americans pay even less in taxes, so poor people can starve and die in the streets as White Jesus intended. Because Making America Great Again requires a $100,000,000,000 tax cut on investment income, obviously.
Why would they try this 100 days before the mid-terms? Dunno, but the Magic Hate Ball says, "Chance of Avarice is HIGH!"
But before we head for the front, let's pause for a brief math lesson. AND NO SASS TALK, OR YOU'RE ALL GONNA BE ON LATRINE DUTY. Now, March!!!
Okay, let's say you earn $1,000 at your job at Acme Corporation making cartoon missiles.
In 2008, Betsy DeVos bought $1,000 dollars worth of Acme Corporation stock, which she sold yesterday for $2,000.
You earned $1,000 by dragging your ass to the plant every day. You ironed your blouse, packed your lunch, drove to Acme, listened to that dickhead Trump supporter in the cubicle next to you, filled out your timesheet, and turned around to do it all again the next day. She earned $1,000 with plenty of time left over to destroy the American education system. Who should pay more in taxes?
DUH, OBVIOUSLY YOU!
Your $1,000 is ORDINARY INCOME, taxed at roughly 25% assuming you're not in Acme's C-suite. But DeVos's income is LONG-TERM CAPITAL GAIN, that is growth on investments, so she'll pay 20% -- and that's only because she and her husband earn more than $479,000 per year. (Mere mortals making $478,999 or less pay capital gains at 15%.)
So, why are you paying $250 while Betsy DeVos pays $200 on the same $1,000 of earnings? Because Betsy DeVos gives away millions of dollars in political contributions, and you don't! Although, the lobbyists who write the laws would probably say that everyone makes more money when the "penalty" for selling capital is low. Because those politicians are lying whores.
But wait, the White House would like to tilt the playing field even further against you! See, Betsy bought that stock for $1,000, which is known as her BASIS. Her GAIN is the difference between the BASIS and the SALE PRICE. Imagine that they found a way to adjust her BASIS upward so that it looks like she bought the stock at $1,200 -- then her gain would be just $800, and her taxes would fall to $160!
Well, imagine no more! Because Stephen Mnuchin has an awesome plan to adjust poor Betsy's BASIS "for inflation." So at roughly 2% inflation per year, compounded over 10 years, she can now pretend to have bought her stock at $1,200. (More or less, don't @ me for simplifying the math!)
So you're still paying $250 on your $1,000 of earned income. But if the White House gets its way, Betsy will pay $160 on her $1,000 -- ahem, $800 -- of passive gains. NEAT, HUH?
WAIT, WHAT THE FUCK? Who the hell thinks this is a good idea?
"I think we ought to look at not penalizing Americans for inflation," said Representative Kevin Brady of Texas, the Republican chairman of the Ways and Means Committee, who said he would like to see the Treasury Department make the change through regulation.
Even the House Freedom Caucus isn't stupid enough to try to pass this shit in an election year. So the White House Brain Trust put their heads together and decided to try to let the Treasury Department enact the change as a regulation -- essentially they'll redefine "cost" as "cost PLUS INFLATION."
The second Bush administration, which was no slouch when it came to robbing the poor to feed the rich, considered the inflation boondoggle. But ultimately they decided it was hella illegal.
Mr. Bush's Treasury Department determined that redefining "cost" by regulatory fiat would be illegal — a conclusion buttressed by the Justice Department's Office of Legal Counsel, which found that "cost" means the price that was paid for something.
Republicans are already running away from their shitshow tax cut. What kind of idiots would give $100,000,000,000 to rich people heading into the midterms?
According to the budget model used by the University of Pennsylvania's Wharton School of Business, indexing capital gains to inflation would reduce government revenues by $102 billion over a decade, with 86 percent of the benefits going to the top 1 percent. A July report from the Congressional Research Service said that the additional debt incurred by indexing capital gains to inflation would most likely offset any stimulus that the smaller tax burden provided to the economy.
Reached for comment, Stephen Mnuchin laughed nasally and said, DO I LOOK LIKE I CARE? as his wife rubbed his sore feet with the skins of Dalmatian puppies. Probably.
AND AMERICA WAS GREAT AGAIN. Amen.
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Liz Dye lives in Baltimore with her wonderful husband and a houseful of teenagers. When she isn't being mad about a thing on the internet, she's hiding in plain sight in the carpool line. She's the one wearing yoga pants glaring at her phone.