In a recent New York Times column, ‚??The G.O.P. Is No Party for Honest Men,‚?Ě Keynesian warrior and Nobel Prize-winning economist Paul Krugman starts out by admitting he is confounded that only 60 percent of Americans in a recent poll think that the tax plan favors the rich.
According to Krugman, ‚??It‚??s shocking that as many as 40 percent of Americans don‚??t realize this.‚?Ě Well, you might be surprised that I agree that the tax plan does favor the rich‚?¶ and it should.
Indeed, one of the most aggravating accusations levied against the Trump administration and the GOP‚??s tax reform proposals is that it favors the rich.
I say aggravating, because that criticism is analogous to saying that the lunch special at the Chinese buffet favors those who eat a lot.
Of course, the tax plan, i.e. tax cuts, are going to favor the rich. That‚??s because it‚??s the rich who pay the taxes.
This simple fact of reality seems to be lost on those who are quick to criticize tax cuts, chief among them Krugman. Surely, the Yale and MIT-educated professor knows that the overwhelming majority of income tax revenue collected by the federal government comes from the richest Americans, i.e. the much-maligned ‚??top 1%‚?Ě?
According to Krugman, ‚??The main elements of the [GOP] plan are a cut in top individual tax rates; a cut in corporate taxes; an end to the estate tax; and the creation of a big new loophole that will allow wealthy individuals to pretend that they are small businesses, and get a preferential tax rate. All of these overwhelmingly benefit the wealthy, mainly the top 1 percent.‚?Ě
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