Fox’s Your World show did its part to demonize President Joe Biden’s infrastructure plan with scare tactics about raising the corporate tax rate, which is Biden’s proposal to pay for it, even though the proposed rate would still be lower than before Trump took office.
While Biden proposes to raise the corporate tax rate from 21 to 28 percent, the rate had been 35 percent before Trump cut it, as The New York Times noted. Corporations did pretty well under the Obama administration at that rate.
But Cavuto and guest acted like the sky would fall at a rate midway between the two previous presidencies.
Cavuto cited what he called “an interesting study” about corporate taxes. He said, “That’s not a good economic prescription for us.”
Guest Scott Hodge, president of the Tax Foundation, was all in. “Not at all, Neil,” Hodge agreed. He said it’s “just plain false” that raising taxes “is going to have no economic consequences.”
France and Sweden are lowering their corporate tax rates “to be more competitive and attract jobs, wages, and investment to their countries,” Hodge continued, “and meanwhile we’re talking about going the other direction.”
That’s not a universal view. The Roosevelt Institute, a think tank, says higher corporate taxes are good for the economy.
Hodge continued by complaining that the wealthy are being soaked. FACT CHECK: While the richest .01 percent have quadrupled their wealth over the last 70 years, their percent of the tax obligation has stayed the same.
“The wealthy in our country pay a higher share of the tax burden than do the wealthy in any other country,” Hodge said. “The IRS has become an extension of the welfare state” with “the Earned Income Tax Credit, the Child Credit.”
Cavuto called Hodge’s statistics “eyebrow-raising numbers” and “a list you don’t want to be on top of.”
You can watch the carping below, from the April 5, 2021 Your World.
Today, by the way, Jeff Bezos said he supports both the infrastructure plan and Biden’s proposed corporate rate hike.
As Pete said (paraphrasing): When I was mayor, the first question I got from companies expressing interest in setting up in my town was "what can you offer us in the way of infrastructure?
They have to listen to Cavuto bleat about not taxing the rich when they themselves are being pinched.
It takes brass b-lls to claim the rich are being cheated while at the same time cheating the very people who make it possible to put you on the air. Truly pathetic.
To start with, US corporations rarely pay the book rate on their actual income. They use every deduction they can, and every subsidy they can, and every maneuver they can to avoid a substantial amount of their tax burden. My understanding is that many of the larger corps are paying less than 10 percent once all their deductions are added in. (And pundits like Hannity were begging the GOP to lower the corp rate to 15% when they inflicted the Tax Transfer, which would have meant that most corps would actually pay ZERO.) The other countries being mentioned do not have the same deductions the US allows, which means the EFFECTIVE tax rate the corps pay in the US is much, much lower than anywhere else in the world. This is the reason that corps aren’t rushing to flee the continent – not the supposed blindness that Hodge essentially accused them of having.
Next, the tax credits Hodge was scorning are actually lifelines for families with children. And under the prior code that angry Right Wingers destroyed with their Tax Transfer, every family used to receive an Individual Exemption for each person, adult or child, in their household. It was about 4K per person, so if you had a married couple with 2 kids, they’d be looking at a 16K deduction on top of either their Standard Deduction or their itemizations. The Tax Transfer put a single Individual Exemption into the Standard Deduction itself and then added a little cream on the top so they could say they’d doubled the SD. This meant that a married couple that itemized would now lose 16K of deductions in that single area. The tax credit for each child is not the same thing, and it does not make up for that loss.
But let’s get to the actual meat of the discussion. For the 743rd time, the GOP gleefully RAISED taxes on Middle Class employees with their Tax Transfer while they were lowering them for the corps and the wealthy. I’ll say that again – tax rates went UP for Middle Class employees, while the people earning over 415K per year saw a tax cut of nearly 3%. And on top of that, angry Right Wing Republicans also erased nearly all the deductions that Middle Class Employees could have claimed, while retaining them for the corps and for the “independent contractors”. (In simpler language, the GOP was going after the union members and the middle managers while sparing the contractors, since the feeling was that contractors tend to be Republican while employees tend to be Democrats.)
The actual result of the Republican Tax Transfer was that Middle Class employees, particularly those in Blue States, saw their federal tax burden SKYROCKETED. My own tax burden shot up by several thousand dollars per year, as did the burden of nearly every co-worker and acquaintance of mine. So it’s frankly a bit rich to hear Cavuto and Hodge bemoaning the idea that the wealthy might have to pay a little more. I don’t recall hearing Cavuto expressing concern about tens of millions of Middle Class employees. So this concern about the wealthy and the big corps who actually pay under 10 percent per year is not something that rings as genuine.
Angry Right Wingers have no ground upon which to stand here. They need to own the fact that they deliberately raised taxes on the Middle Class while trying to protect their donors. And they need to stop trying to lie about the significantly increased tax bills they inflicted upon so many Americans.