This just in, from the New York Times:
The Trump administration is considering bypassing Congress to grant a $100 billion tax cut mainly to the wealthy, a legally tenuous maneuver that would cut capital gains taxation and fulfill a long-held ambition of many investors and conservatives.
What the bleep? The executive branch can’t change tax law, can it?
Let us not forget that Mnuchin is a parasite who made a bundle foreclosing on people during the 2008 meltdown.
the Treasury secretary, said in an interview on the sidelines of the Group of 20 summit meeting in Argentina this month that his department was studying whether it could use its regulatory powers to allow Americans to account for inflation in determining capital gains tax liabilities. The Treasury Department could change the definition of â€œcostâ€ for calculating capital gains, allowing taxpayers to adjust the initial value of an asset, such as a home or a share of stock, for inflation when it sells.
Even I can figure out that if you’ve got rising inflation and low capital gains rates, you could erase a whole lot ofÂ profit for tax purposes.
â€œIf it canâ€™t get done through a legislation process, we will look at what tools at Treasury we have to do it on our own and weâ€™ll consider that,â€ Mr. Mnuchin said, emphasizing that he had not concluded whether the Treasury Department had the authority to act alone. â€œWe are studying that internally, and we are also studying the economic costs and the impact on growth.â€
Would this provide economic stimulus?
Â Independent analyses suggestÂ that more than 97 percent of the benefits of indexing capital gains for inflation would go to the top 10 percent of income earners in America. Nearly two-thirds of the benefits would go to the super wealthy â€” the top 0.1 percent of American income earners.
Nope, probably not.
Making the change by fiat would be a bold use of executive power â€” one that President George Bushâ€™s administration considered andÂ rejected in 1992, after concluding that the Treasury Department did not have the power to make the change on its own. Larry Kudlow, the chairman of the National Economic Council,Â has long advocated it.
Larry Kudlow is the moron who declared a month ago that the U.S. deficit was going down. Grover Norquist also thinks this is a great idea.
â€œThis would be in terms of its economic impact over the next several years, and long term, similar in size as the last tax cut,â€ Mr. Norquist said, suggesting that making the change would raise revenue for the government by creating new economic efficiencies and faster growth. â€œI think itâ€™s going to happen and itâ€™s going to be huge.â€
He and others said last yearâ€™s tax cut would also pay for itself, but despite strong economic growth,Â corporate tax receipts have plunged and the deficit has soared.
Sober people with calculators weigh in:
According to the budget model used by theÂ University of Pennsylvaniaâ€™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.
â€œIt is unlikely, however, that a significant, or any, effect on economic growth would occur from a stand-alone indexing proposal,â€ the report said.
Of course it won’t. But, you know, I really want Mnuchin to push for this so that it gets in the news and everybody hears that the Trump Administration is pushing for another giveaway to the rich. Because tax cuts for the rich are unpopular with voters. This is from June 2018:
This month, anÂ NBC/WSJ pollÂ of registered voters in swing congressional House districts found that a candidateâ€™s support for the tax law passed in December might cost them in this Novemberâ€™s election.
Forty-two percent of voters were less likely to vote for a candidate who supported the tax law compared to 36 percent who said that they were more likely. That difference might seem small but in a highly competitive House race, itâ€™s huge.
I also want The Creature to keep threatening to shut down the governmentÂ if Congress doesn’t fund his fool wall. And then I want to see lots and lots of ads juxtapoxing Trump’s threats with videos of him swearing Mexico will pay for the wall. Even the Democrats ought to be able to use this nonsense to club the entire Republican party to death.
See also Paul Krugman, Trump’s Supreme Betrayal.