Class warfare fight erupts over tax bills

Tensions over class warfare and whether GOP tax plans help the rich over the middle class and poor are building in Congress as Republicans march forward with their legislation.

Democrats have been forcefully and repeatedly arguing that the GOP wants to cut taxes for wealthy individuals and corporations at the expense of everyone else. Republicans, annoyed with the attacks, have pushed back, saying their focus is on the middle class.

The issue came to a head late Thursday with an eruption from Senate Finance Committee Chairman Orrin Hatch (R-Utah) toward the end of a grueling four-day markup of the chamber’s bill.

The 83-year-old chairman blew up after Sen. Sherrod Brown (D-Ohio) argued that the bill is geared toward the rich.

{mosads}“I come from the poor people, and I’ve been here working my whole stinking career for people who don’t have a chance,” said Hatch, who was first elected to the Senate in 1976 and is battling rumors that this will be his final term. “And I really resent anybody saying that I’m just doing this for the rich. Give me a break.”

“I think you guys overplay that all the time and it gets old, and frankly you ought to quit it,” he said in a moment that quickly went viral.

Fights over class are nothing new in Washington, where generations of Democrats have labeled Republicans as warriors for the wealthy. Hatch also is hardly the first GOP lawmaker to take offense.

Republicans have long accused Democrats of engaging in class warfare for their attacks on the rich. But Democrats have also accused Republicans of attacking the middle class. 

Brown, who has focused on the working class in his time in the Senate and is up for reelection next year in a state President Trump carried, said on MSNBC in 2011 that when Republicans accuse Democrats of class warfare, Democrats “point out the class warfare [Republicans have] wagged against the middle class.”

GOP lawmakers have highlighted elements of their bills they say benefit the middle class, including the increases in the standard deduction and child tax credit. The Senate’s bill zeros out ObamaCare’s individual mandate penalty for those who don’t have health insurance, and Republicans have also highlighted that most people who pay the penalty make under $50,000.

Additionally, Republicans have said their bill is designed to make U.S. businesses more competitive with companies in other countries, and will lead to rising wages and job growth.

But Democrats have argued that the corporate tax cuts are more likely to benefit wealthy shareholders than workers. They have highlighted parts of the bills that seem to be geared to helping the rich, such as their scaling back of the estate tax and the repeal of the alternative minimum tax. They have also put a spotlight on tax breaks benefiting the middle class that would be eliminated.

Democrats have also expressed concerns that the tax-cut effort would hurt people on health care. They have pointed to Congressional Budget Office (CBO) data showing that repeal of the individual mandate would lead to fewer people with insurance and higher premiums, and have noted that the CBO said that tax legislation’s increase to the deficit could trigger automatic cuts to Medicare unless certain budget rules are waived.

Both sides are using data from Congress’s tax scorekeeper, the Joint Committee on Taxation, to make their cases.

Republicans have pointed to data that shows people across the spectrum would win tax cuts from the plan, particularly in the short term, while Democrats have highlighted that millions of low- and middle-income families would see their taxes go up, especially in future years.

The Joint Committee on Taxation found that under the Senate’s bill, in 2027 those making less than $75,000 would see their taxes go up on average, since the measure’s tax cuts for individuals expire after 2025.

While Republicans say they would plan to extend those tax cuts in the future, Democrats are furious that the GOP chose to make individual tax cuts temporary while making corporate tax cuts permanent.

Many polls have shown weak support for the GOP’s tax plans, so Democrats view taxes as a winning issue for them.

“The tax bill is a political minefield for the Republicans,” Democratic strategist Brad Bannon said.

Bannon argued that Democrats should “go to town” with attacks on the GOP tax bills given their unpopularity.

“If somebody gives you a gift, and you don’t take it, you’re crazy,” he said.

But Republicans see political benefits to the tax bill as well. They’re eager to show voters that they can enact major legislation ahead of the midterm elections.

Tax-cut advocates view Democrats’ attacks as stale and lacking in merit, but they also think it’s smart for Republicans to push back on Democrats’ criticisms.

“You don’t want to leave an argument, no matter how ridiculous, unchallenged,” said Americans for Tax Reform President Grover Norquist.

Meanwhile, some conservative groups have criticized Republicans for some of their measures that are designed to keep the tax code progressive.

The Club for Growth and Americans for Prosperity supported the overall tax bill that the House passed on Thursday, but criticized it for keeping the top individual tax rate at 39.6 percent and including a “bubble rate” above that for some income of high earners.

“We believe it gives in to the class-warfare arguments,” said AFP President Tim Phillips.

The Senate’s bill, which is expected to receive floor consideration the week after Thanksgiving, lowers the top rate to 38.5 percent and doesn’t include a bubble rate.

But a senator whose vote could be important, Susan Collins (R-Maine), said she wants the top rate to stay at 39.6 percent so that other priorities could be funded.

“There’s a lot that we could do with that funding,” she recently told reporters.