Taxes

Donald Trump’s Big, Beautiful Bill was supposed to slash government waste and inefficiency. So why is it going to result in an even bigger, uglier deficit? The legislation was still being picked over in the Senate as this magazine went to press. But the Committee for a Responsible Federal Budget has calculated that the bill will add $2.5 trillion to the deficit over the next decade – and that estimate is far more likely to go up than down. The President’s opponents have characterized the Big, Beautiful Bill as a swindle that steals from the poor to give to the rich. That may be true to some extent, in that it could become harder for some people to qualify for Medicaid, while wealthy Americans will enjoy the extension of lower tax rates.

As the level of US debt zooms past the $34 trillion mark, it has become increasingly clear that the American left has no intention of trying to help control government spending. To the extent that annual deficits must be trimmed to protect the integrity of the nation’s currency, Democrats and their allies are instead planning to go beyond the current progressive tax on income and institute a new levy on citizens’ assets. Some such as Senator Elizabeth Warren openly advocate taking the conventional idea of a property tax and applying it to everything a person owns — cash, savings accounts, stocks, jewelry and even art.

It’s no secret that Americans are moving from blue states to red ones. According to recently released Census Bureau data, the five with the largest population loss to other states between July 2022 and July 2023 were California (-338,371), then New York (-216,778), Illinois (-83,839), New Jersey (-44,666), Massachusetts (-39,149) and Maryland (-30,905). The five states with the largest overall increases during the same period were Texas (473,453), Florida (365,205), Georgia (116,077), South Carolina (90,600) and Tennessee (77,512). The most frequently cited reason for this ongoing blue-to-red migration is taxes — or, more correctly, the opportunity to pay less and fewer of them.

Joe Biden’s lengthy State of the Union address on Tuesday saw him call on Congress to pass a bevy of policies, most of which were regurgitations of his previous proposals. Here's a look at some of the policies that were mentioned by the president. Capping insulin prices at $35 Everyone knew this would be on the agenda after the Inflation Reduction Act passed Congress last August. The IRA's Medicare copay cap was just a foot in the door, with a push for further drug price controls an inevitability. The problem is that price controls do not work. Ed Haislmaier of the Heritage Foundation succinctly outlines how the problem can be mitigated responsibly. The most obvious option is to eliminate the prescription requirement for insulin.

Americans are voting with their feet and the results are in: red states are winning. An incredible 46 million people moved to a new ZIP code over the year to February 2022, the highest annual total since Equifax, a credit agency, began tracking moves in 2010. Republican-leaning red states gained the most residents — led by Florida, Texas, and North Carolina — while the blue states of California, New York, and Illinois were the biggest migratory losers. The most popular pandemic-era moves were from New York to Florida and California to Texas — so much so that U-Haul ran out of moving trucks leaving California last year. Given the chance to flee high-cost cities, Millennials did so in droves.

“Freedom is under attack in your state,” exclaimed California Governor Gavin Newsom in a bizarre 30-second television ad that aired on Fox News in Florida markets over Fourth of July weekend. Unnamed “Republican leaders,” gasped a man who held his constituents under near-house arrest for two years, are “banning books, making it harder to vote, restricting speech in classrooms, even criminalizing women and doctors. I urge all of you to join the fight, or join us in California, where we still believe in freedom.” Newsom’s anti-Florida canards cost his 2022 reelection campaign a reported $105,000. They addressed an audience that will vote neither for nor against him.

If you had "Trump goes to jail" in the office pool, you just lost. The end of any possible criminal prosecution out of New York over Donald Trump's finances has come as the grand jury seated to find them has sunsetted. The possibility of a civil penalty, likely a fine, looks poor, but anything is possible. This is all a long way from predictions that the walls were closing in back when these cases were initiated in the Southern District of New York (SDNY). Dems, dragging all their Biden baggage along, are going to have to beat Trump at the ballot box, assuming anyone can afford the gas to drive out to vote.

Senate Majority Leader Chuck Schumer knows how to fix inflation: higher taxes. “If you want to get rid of inflation, the only way to do it is to undo a lot of the Trump tax cuts and raise rates,” surmised the New York Democrat to reporters on Tuesday, after meeting with West Virginia Senator Joe Manchin about the budget. “No Republican is ever going to do that. So the only way to get rid of inflation is through reconciliation.” Manchin saw it slightly differently, portraying tax increases as budget reduction tools. He believes debt reduction is “the only way” to fight an inflation problem that threatens to wash away Democratic majorities in Congress.

By removing Donald Trump from social media and New York governor Andrew Cuomo from office, progressives unwittingly gave an opening to a largely unheralded candidate in New Jersey. That’s why the newspaper headlines on the Wednesday morning after the election all declared the governor’s race in the Garden State “too close to call,” which in itself is a victory for beleaguered Republicans from the northeast. And even if Democratic governor Phil Murphy does pull it off, as now looks likely, this election portends serious headaches for Democrats.

There is a spot of Washington DC, a few blocks of downtown not far from the White House, where a cigarette is your only hope. The buildings are garish blocks of glass — 'like someone overturned a giant ice cube tray,' as one wag put it — while the color palette runs from charcoal gray to navy gray. The place can feel like ennui embodied, and all the worse when rain darkens the air and the streets fill with the soulless din of tires swishing through puddles. It can wear on you, this drab slice of middle-managerial noir. But at least for me, there is one thing that can brighten it up: cigarette smoke. I might catch it off a passerby or light up a Marlboro myself. But either way I feel paradoxically improved. I think, at least someone here is having a good time.

President Joe Biden just proposed the largest budget (as a percentage of America’s economy) since the country was fighting Nazi Germany, Imperial Japan and Fascist Italy. He’s doing it when there is no emergency, only an overweening desire to pass progressive programs quickly, before they lose their legislative majority. The best historical analogue to his proposed budget increase is Lyndon Johnson’s cradle-to-grave Great Society Program. It has the same flaws. In fact, Biden’s program is best understood as the next step in a long political arc, extending from Franklin Roosevelt to LBJ to Obamacare. All of them proposed centralized government solutions to almost every social problem, particularly endemic problems among the poor.

Mark Sanford might not eat brains, but he is the closest thing in American politics to the living dead, an authentic Zombie Republican. His career died a decade ago when he was governor of South Carolina and absented himself from office for a few days to go off hiking the Appalachian Trail – or rather boffing the Argentinian mistress. He was censured, nearly impeached, but clung to office anyway until his term expired in 2011. And then, two years later, he shambled back to a familiar haunt, the US House of Representatives. Sanford began his brief national career as a Class of ’94 House Republican insurgent. And there he was again, nearly a decade later, after winning a 2013 special election.

Here’s a wild idea: what if Congressmen and women weren’t allowed to hire accountants or lawyers, use software or go to H&R Block to fill out their tax returns? What if, like that brave 10 percent who do their taxes themselves, Congress had to sit down and do their taxes on their own? Their first time would be atrocious: wading through hundreds of pages of tax code, endless provisions, starting their forms out from scratch when they got something wrong. All this with the fear of making a mistake and getting audited, with nobody to blame but themselves. It would be glorious: our legislators would be forced to acknowledge how monstrous the tax system is.