One of the goals of Pursuit is to provide objective analysis from the perspective of younger Americans. The hysteria and spin of the tax debate has tended to be fact free or lacking key context. How can one bill change so much based on your partisan perspective? The use of the year 2027 has become a revealing, albeit, sad reminder of the divisions in our country’s discourse. It’s a partisan Rorschach test of sorts. Here is a handy BS detector for how to determine the use of 2027.
Your taxes are going up in 2027!
If the only thing a politician or publication wants to tell you is that taxes will go up on the middle-class in 2027 – they are leaving out incredibly important context. I have a proposal for you. Over the next 10 years, I will give you $10 per year for the first 8 years, but you have to give me back $2 per year for the next two. Would you take it? Of course you would. Yet opponents of the tax bill say you should decline it because they are stealing $2 from you in year 9 and 10.
Don’t worry about 2027 – the tax cuts will be extended:
If the politician or publication is telling you the only reason why the tax breaks for individuals are expiring is the complicated and arcane Senate rules, they are also fibbing. In order to pass the bill with only Republican support, the bill could not increase deficits in any year from 11 years from now until the explosion of the sun. There are plenty of complicated and arcane Senate rules, but this ain’t one of them. To meet that rule, the Republican plan lets the individual tax cuts expire in 2025 to mask the impacts it will have on the deficit outside of the 10 year budget window. While the proponents of the bill are trying to downplay the impact it will have on the debt, their stated aspirations are for the tax plans to cost even more. According to the Committee for a Responsible Federal Budget, if the expiration was not included, the bill would cost up to $2.2 trillion – a far cry from paying for itself.
Here is what is truly revealing about 2027. By using deficit financing instead of paying for the tax cuts, the bill is pulling resources from 2027 into 2017. Future millennial led households will be paying more in taxes so that current households can have tax cuts right now. A deficit financed tax cut isn’t really a tax cut. It’s a tax shift.
No generation has stolen more from the next generations than the leaders in charge right now. 2027 is being used as a data point for political purposes. But 2027 is an actual point of time that is coming and millennials will be in charge then. What will our economy and budget look like then? That depends on what is happening right now. That’s why it’s critical for younger Americans to get involved now. In 2027, it may be too late.