You Can’t Have a Middle Class Tax Cut Without a Middle Class

It didn’t take much time or advanced math to reveal the Republican tax plan as a rich man’s plan. Despite the GOP’s use of threadbare double-speak about “relief” for working families, the middle class, and small businesses, the plan’s biggest and most permanent savings are heavily weighted to the country’s top earners, its biggest corporations, and the heirs of the super-rich. According to a much-cited analysis by the Tax Policy Center, nearly half of the benefits accrue to the wealthiest 1 percent.

Given the modern history of Republican tax plans, this was easily guessed even without opening the bill binders delivered to the House and Senate. The question was never whether the plan would be a heist using a limousine getaway car. The question was how brazen the heist would be.

Turns out, pretty brazen. Upwards of 40 million middle-class families will see higher tax and healthcare bills, with millions more losing health care coverage entirely — all to fund a wealth transfer to the wealthiest Americans. As Paul Krugman detailed last week, the House plan is riddled with sadistic touches like eliminating deductions that provide minor tax breaks to Americans struggling with the strangling cost of higher education. Student loans and employee contributions to tuition bills would no longer be deductible.

Middle Class Is Getting Screwed Out of Existence

When GOP tax cutters utter homilies about “the middle class,” they’re using a dog-eared rhetorical playbook. But the reference to the “middle class” is now almost as anachronistic as the claim to be helping them is absurd. The “middle class” has not just been getting screwed for decades by “supply-side” tax cuts and other policies — it has been getting screwed out of existence.

In 1971, Americans defined as middle class constituted a majority of the adult U.S. population. There were 80 million of them, and only 50 million Americans with incomes below or above (mostly below) the middle-class range. (Middle-class is generally defined as between two-thirds and twice the median national income). By 2015, this dominance was reversed: 120.8 million middle-class adults were edged out by 121.3 million adults earning well below or well above the national median income. Today, there are more rich and poor Americans than there are middle-class Americans, whose share of the nation’s wealth has been deeply eroded to the benefit of the rich.

The decline of the middle class is a complex story much bigger than tax policy, of course. Two contributing factors are the exorbitant and rising costs of healthcare and higher education — costs made even more burdensome by the new  GOP tax bill. Any tax bill honestly concerned with the middle-class would begin by broadening access to affordable healthcare and expanding deductions for university tuition. A plan that does neither, let alone the opposite, is exposed for what it is, right out of the gate.

The broad middle is disappearing in other, less visible ways than just falling incomes and erased savings. The middle class was always more than just an income category; it implied stability, security, satisfaction, leisure, and hope. Fewer and fewer Americans — even if they fall within the middle-class income bracket — actually enjoy these things. This has led to a reevaluation of the very term “middle class” — one that decouples the median income bracket from the psychological benefits historically associated with it.

This Is How Democrats Lost Some Democratic Voters to Trump

This is a bipartisan story. The steadily hollowing of the middle class in recent decades was a contributing factor to the election of Donald Trump, who campaigned (falsely but energetically, and often convincingly) as an economic populist. By attacking Wall Street and promising to protect Social Security and Medicare, Trump did more than just win over “working class whites” in rural areas and the Rust Belt. A Pew study conducted after the election found that Trump cut into the Democratic vote in most of the middle-class metropolitan areas that helped propel Obama to the White House in 2008 and keep him there in 2012. According to Pew, “The loss in support was sufficiently large to move 37 metropolitan areas from the Democratic column to the Republican column…18 of these areas were solidly middle class.”

At least, they were on paper. It’s unlikely many of those people have been psychologically middle class for a long time.

It is a sad and enraging spectacle, if also an entirely predictable one, to see Trump now promoting a tax plan that benefits those with cameos in the Paradise Papers, while pushing everyone else further down into a social and economic inferno.

Alexander Zaitchik
Alexander Zaitchik is a journalist based in New Orleans. His most recent book is The Gilded Rage: A Wild Ride Through Donald Trump's America.

You Can’t Have a Middle Class Tax Cut Without a Middle Class

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