Glenn Hubbard

Silly season is well and truly underway.

Earlier this week Jeb! – formerly known as Jeb Bush – released his great spanking new tax plan. Except there wasn’t much new in it. We’ve seen all of it before, but usually in separate pieces.

Undaunted by the spectacular failure of his brother’s 2001 and 2003 tax cuts which both blew a great hole in the Federal budget and failed to deliver much of the promised growth, Jeb! has doubled down on plutocratic tax policy.

The highlights are that he proposes to reduce the current five tax brackets to three, with the top rate being cut back to the old Reagan level of 28% (it is currently 39.6%). I suppose Jeb! fails to recall that even Ronnie the Amazing was forced by subsequent budget problems to raise the top rate higher than that 28%, but never mind. Jeb! is just getting going.

He is also proposing to double the standard deduction that most families take on their taxes. This would so reduce taxable incomes that millions of low income families would fall below the threshold for paying any taxes at all. This flies in that face of the argument that many Republicans were making during that last election: they were aghast that millions of American don’t pay income taxes and thus had ‘no skin in the game’. Apparently this is no longer an issue. At least not for Jeb!

Why not?

Well he has to throw a sop to the masses doesn’t he?

He must if he wants to persuade them to allow him to slash taxes for the wealthy and big business.

And that’s the core of the entire plan.

Jeb!’s plan is to cut corporate tax rates to 30%, which is silly because no well run business pays anywhere near the current rate of 35% after all the fiddling and special deductions they take. Just ask Apple or Google, both of whom have parked vast seas of cash abroad in order not to pay taxes at all.

Then he wants to eliminate the estate tax altogether. After all rich families have a right to concentrate their wealth don’t they? This is particularly galling because the US was an early leader in instituting an estate tax back around World War I. It’s primary purpose was to prevent the exact concentration of wealth that the Republicans are now so hell bent on encouraging. An estate tax is one of our barriers to the emergence of a class system. I guess all that talk of equality is not fashionable any longer. At least amongst Republicans (was it ever?).

Next up, Jeb! wants to eliminate the write-offs currently allowed for State and Local taxes, and also to put tight limits on the allowances for mortgage interest and health care costs. This is a direct attack on the middle class living in higher tax states, which, I am sure by pure coincidence, tend to vote for Democrats. The effect on the governments services, and especially education, could be disastrous. But who cares about that?

Now comes the fun part:

Presumably Jeb! sent an early copy of his plan to the Tax Foundation, a notoriously conservative and gung-ho group who have never seen a tax cut they didn’t like. They have analyzed the plan for us so we can see how it affects the economy.

Naturally Jeb! has claimed all sorts of miraculous magical effects. His plan is a libertarian dream come true. GDP will soar! Jobs will drop from the sky by the bushel load! Tax revenues will increase! The deficit will shrivel to nothing! Job creators will be free to … well whatever they do, like buy more yachts.

Well not quite.

It turns out that even the wildly optimistic Tax Foundation cannot make any of that happen. Try as they might Jeb!’s plan sucks.

Contrary to his promises it blows a great big hole in the budget. To the tune of $1.6 trillion over the next decade. And that’s if we look on the bright side. If we are somewhat more sober – which of course you and I are – and we ignore all the silly supply side hoodoo and hoopla, then that gaping hole widens even more. To a whopping $3.7 trillion to be exact.

So there you have it.

The Bush family is at it again. I can only assume they pay no attention to any of the reports they might receive, or to history, or to any other thing that could darken their jolly supply side sensibilities.

The inestimable Glenn Hubbard – one of the ethically challenged stars of the movie “The Inside Job” – has been rolled out to defend the plan. He says its just wonderful and that GDP growth will double – double I tell you – if Jeb! can only get those tax cuts to his rich buddies.

Meanwhile here on earth we lumber along waiting for one of theses clowns to put forward a plan that has a smidgeon of reality in it. Yes, we are reduced to such desperation that a plan with the merest touch of reality would surely look good.

Jeb!’s plan is too moronic to qualify even by that minimal standard.

Still it brings a tear to my eye as I recall all those fun times we had laughing in disbelief as his brother dug the economic hole from which we are only now crawling out.

Please not Bush Jeb!