House Republicans are taking well-deserved flak for their tax bill, which passed by a 357-70 vote last week. Critics have primarily trained their fire on the beefed-up child tax credit, with its deficit spending and replacement of work with welfare. But that provision isn’t the only mistake in this legislative monstrosity. Republicans should be equally ashamed of doubling down on corporate welfare.
Among its other giveaways, the bill expands a business deduction for interest payments, providing an incentive to choose corporate debt over equity while undermining the party’s own 2017 tax reform. It also resurrects a research-and-development deduction, subsidizing investments that studies show businesses would have made without taxpayer help. The bill is unfortunately consistent with the GOP’s willingness to subsidize companies, from chip makers to steelmakers, as the party of business boondoggles.
About the GOP’s tax bill, Michail Tsatsanis’s letter in the Wall Street Journal is spot-on:
I found the Orwellian inversion of reality in the new tax bill astounding. A regular program of welfare checks to people with children is now called a tax cut (“A Tax Bill for Gucci Gulch,” Review & Outlook, Feb. 2).
I have an idea. In the future, let’s funnel all government spending via the Internal Revenue Service and call it tax cuts. Spending to expand the food-stamps program? Tax cuts! Pell grants and scholarships? More tax cuts. The Federal Emergency Management Agency giving free water and food to a disaster stricken area? Targeted tax cuts. You send your kid to public school for free? You have received a tax cut.
I generally don’t like it when people insult my intelligence. I don’t know how these lawmakers get away with insulting the intelligence of their voters.
Paul Schwennesen applauds Javier Milei’s classical-liberal vision. A slice:
All of this is music to classical liberal ears, to be sure, but what made the speech especially welcome was the alternative vision he offered. Rather than simply bemoan the poor policies of Peronist statism, he laid out precisely why the alternative to statism — liberated markets — can offer so much more. A recurrent theme in his speech was the power of freely interacting peoples to establish the profound process of “discovery” in the Hayekian sense (citing Israel Kirzner).
Keith Whittington agrees with the court’s ruling against Trump’s assertion of immunity.
Megan McArdle reveals “the good reason why airlines don’t promise your family will sit together.” A slice:
Every argument about airline customer policy is essentially the same one: “I should be entitled to cheaper and more pleasant flights, and airlines should charge someone else more or make their flight less pleasant to give me what I deserve.” To be clear, people don’t always realize this is the argument they’re making — but it is, just the same, whether they’re arguing about the ethics of reclining, or demanding that airlines provide, for free, some amenity they currently charge for.
Coddled affluent professional tweets: (HT Jay Bhattacharya)
The biggest fallacy is that smart people have intelligent beliefs.
Their are plenty of stupid, terrible ideas that require a high level of intelligence to buy into.
