Republicans finally find something more important than a 20 percent corporate tax rate

Rebekah Entralgo

Rebekah Entralgo Reporter, ThinkProgress

If there was one part of the GOP tax framework President Donald Trump was adamant about, it was a 20 percent corporate rate.

House and Senate Republicans, however, decided today they aren’t so set on it.

Republicans in both chambers have reportedly reached an agreement on the final version of the bill, which includes a 21 percent corporate tax rate. The change in the corporate tax rate will help pay for lowering the top individual tax rate from 39.6 percent to 37 percent, a provision that would benefit millionaires.

At one point, Republicans were so set on a 20 percent corporate tax rate, that while the Senate was in the throes of negotiations two weeks ago, the party collectively struck down an amendment that would have actually provided marginal middle class tax relief to a tax bill that overwhelmingly benefits the wealthy.

Under the current proposed Senate bill, the child tax credit is expanded to $2,000, but isn’t refundable, meaning lower-income families who don’t make enough for income taxes and instead pay only payroll taxes wouldn’t qualify for the full tax credit, with many only receiving an additional $75 per child annually. The amendment written by Sens. Marco Rubio (R-FL) and Mike Lee (R-UT) proposed lowering the level of income at which the tax credit kicks in, extending the benefit to more lower-income families. Rubio and Lee suggested raising the corporate tax rate two percentage points in order to pay for the change, which would have cost around $70 billion dollars.

Republicans voted the amendment down on a procedural vote of 29 to 71, citing the White House’s firm position on a 20 percent corporate tax rate.

Rubio, still frustrated from the defeat of his child tax credit expansion, responded on Twitter.

Earlier in the week Rubio warned there are “going to be problems” if the conference committee weakens the tax credit in any way.

He repeated his criticism shortly after the deal was announced.

Rubio is not necessarily known for bucking the establishment, but it will be interesting to see if he provides any resistance to the GOP’s plan to move forward on a tax plan that barely delivers any tax relief to the working and middle class.

For Trump and other White House officials, the 20 percent corporate tax was essential in delivering the growth they had promised. Drastically cutting the rate 15 points, however, has been shown to be ineffective in spurring job creation. It’s also expensive, costing nearly one trillion dollars, according to the non-partisan Joint Committee on Taxation.

Even with this tax cut at the center of their tax plan, the growth estimates still aren’t there, with the administration’s own analysis refuting their popular talking point that the $1.5 trillion dollar tax plan would pay for itself through growth.

There are a number of other disputes that could prevent the GOP tax plan from becoming law just yet. Some senators, including Susan Collins, (R-ME), Jeff Flake (R-AZ), and Bob Corker (R-TN) have all mentioned various problems with the legislation that would keep them from voting on it.

Now that Democrats have gained another seat from the Alabama special election Tuesday night, the party is pushing for Doug Jones to be seated immediately, making the GOP’s path to overhauling the tax code much more difficult.

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Reposted from Think Progress

Posted In: Allied Approaches

Union Matters

The Big Drip

From the USW

From tumbledown bridges to decrepit roads and failing water systems, crumbling infrastructure undermines America’s safety and prosperity. In coming weeks, Union Matters will delve into this neglect and the urgent need for a rebuilding campaign that creates jobs, fuels economic growth and revitalizes communities. 

A rash of water main breaks in West Berkeley, Calif., and neighboring cities last month flooded streets and left at least 300 residents without water. Routine pressure adjustments in response to water demand likely caused more than a dozen pipes, some made of clay and more than 100 years old, to rupture.

West Berkeley’s brittle mains are not unique. Decades of neglect left aging pipes susceptible to breaks in communities across the U.S., wasting two trillion gallons of treated water each year as these systems near collapse.

Comprehensive upgrades to the nation’s crumbling water systems would stanch the flow and ensure all Americans have reliable access to clean water.

Nationwide, water main breaks increased 27 percent between 2012 and 2018, according to a Utah State University study.  

These breaks not only lead to service disruptions  but also flood out roads, topple trees and cause illness when drinking water becomes contaminated with bacteria.

The American Water Works Association estimated it will cost at least $1 trillion over the next 25 years to upgrade and expand water infrastructure.

Some local water utilities raised their rates to pay for system improvements, but that just hurts poor consumers who can’t pay the higher bills.

And while Congress allocates money for loans that utilities can use to fix portions of their deteriorating systems, that’s merely a drop in the bucket—a fraction of what agencies need for lasting improvements.

America can no longer afford a piecemeal approach to a systemic nationwide crisis. A major, sustained federal commitment to fixing aging pipes and treatment plants would create millions of construction-related jobs while ensuring all Americans have safe, affordable drinking water.

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There is Dignity in All Work

There is Dignity in All Work