Warren takes lead role in fight against Trump tax plan
WASHINGTON — Elizabeth Warren is focusing her trademark populist style on the next big item on the Republican to-do list in Washington: overhauling the US tax code.
The Massachusetts senator kicked off her fresh national effort Wednesday morning by arguing that President Trump and his wealthy Cabinet members stand to reap huge financial rewards from their own tax plan.
“Trump’s tax plan is simple. The rich get richer, and everyone else gets left behind,” Warren said at a press conference, standing alongside Senate minority leader Chuck Schumer. “It is just plain immoral at a time when the top 1 percent are already getting richer and richer and working families are scraping to pay for housing and schools and child care; it is just plain immoral to slash taxes for the rich while sticking it to everyone else.”
That’s a preview of what to expect from Warren in the days, weeks, and months ahead, the senator said in a brief interview after the event. “I will be out there on point on this,” she told the Globe.
The former Harvard professor is seen by fellow Democratic senators and political strategists as someone who can translate the arcana of the tax debate — as she has done with other complex issues — into a simple, potent message that will resonate among working-class voters. She was tapped for the event by party leadership.
Trump, Republicans, and big business lobbies are attempting to make the case that cutting taxes on corporations and the wealthy will stimulate long-term capital investment and create jobs for the middle class. But historically, tax cuts have not been proven to result in that sort of broad economic boost. Democrats hope Americans will look at who benefits most from tax cuts.
“In a sense, this really is the fundamental question about who this government works for,” Warren told the Globe.
She said the Republican tax proposal shows the GOP is working for millionaires and billionaires, including those populating Trump’s Cabinet.
The Republican plan would reduce the corporate tax rate from 35 to 20 percent, cut the top personal income tax rate from 39.6 to 35 percent, and eliminate the estate tax. It also would provide a big windfall to the largest business partnerships, with a new rate of 25 percent — down from as high as 39.6 percent.
Wednesday’s press conference in Washington was to introduce a study from the Center for American Progress, a liberal think tank, that estimates the tax plan would deliver huge windfalls to numerous wealthy Trump administration officials, including Education Secretary Betsy DeVos. That break for business partnerships could give DeVos a $5 million-a-year cut, according to the group’s analysis. The center said it would save Trump’s son-in-law Jared Kushner as much as $17 million a year. Trump’s own family would see more than $1 billion in savings by eliminating the estate tax, the study said.
The White House insists the benefits are for the middle class. The focus of the tax plan “is to benefit the middle class. That’s what the priority is,” press secretary Sarah Huckabee Sanders said Wednesday.
“We’re going to restore America’s competitive edge, rebuild America’s middle class — very much aimed at the middle class — and renew the promise of the American Dream,” Trump said before he met at the White House with a bipartisan group from the Senate Finance Committee Wednesday.
In addition to stronger growth, the plan will also help the middle class with such measures as a higher standard deduction and a reduction in the number of tax brackets from seven to three.
But a leading nonpartisan group of tax experts, the Tax Policy Center, a joint program by the Urban Institute and Brookings Institution, has found that 80 percent of the tax benefits would accrue to those in the top 1 percent. The analysis was based on the GOP’s rough policy outline; legislation has not been drafted that will answer numerous questions about how benefits for the middle class would be shaped.
The debate over taxes starts in earnest this week. Senate Republicans will work to pass their 2018 budget. That is a key step because it will include a provision allowing the GOP to pass its tax plan by a simple majority, rather than the 60 votes that most bills typically need.
The budget process allows both sides to offer a flurry of amendments.
Democrats plan to use the bulk of their amendments to highlight key arguments against the package: that it would deliver big tax cuts for the wealthiest; require cuts to popular programs such as Medicare and Medicaid; raise taxes on middle-class Americans, through the elimination of the widely used state and local tax deduction; and add trillions to the budget deficit.
Warren, who is running for reelection in 2018, plans to introduce several amendments to the legislation and will help lead debate on several other amendments, an aide said, but offered no further details.
The first amendments opposing the package Wednesday, including one written by Vermont Senator Bernie Sanders, would have reversed steep budget cuts to Medicare and Medicaid health programs proposed in the budget legislation. The amendments failed on party line votes. Another Sanders measure would have barred any tax cuts for earners in the top 1 percent.
Democrats hope their battle will yield similar results to their crusade over health care earlier this year, when Senate Republicans failed repeatedly to fulfill a promise to repeal and replace the Affordable Care Act.
Schumer, the Democratic Senate leader, pointed to a recent CBS News poll that found 58 percent of Americans believe the tax plan under discussion would favor the wealthy, while just 18 percent said it would favor the middle class. Schumer said by the time Democrats are done talking about the plan, those numbers would look even worse for the GOP.
The rigid wall of Democratic opposition hasn’t stopped Republicans from trying to woo some Democrats to their cause. During the meeting at the White House, Trump told Democrats in the room he wanted some of them to support his tax bill. Republicans came out saying they were hopeful a bipartisan deal could be reached. Democrats sounded skeptical.
“Everybody in the room wants to focus on the middle class,’’ said Ohio Democrat Sherrod Brown. “Somehow they keep saying they want to do middle class [tax cuts], but they accidentally give tax breaks to the rich. I don’t know how it happens.”