White House chief strategist Steve Bannon is pushing to jack up taxes on the wealthy, in order to pay for serious tax cuts for middle and working-class Americans.
It sounds great, until you remember this was supposed to be a Republican administration, and Republicans don’t tend to see punishing success as a viable way of growing the economy.
- Bannon has told colleagues he wants the top income tax bracket to “have a 4 in front of it.” (The top bracket is currently 39.6% for Americans who earn more than $418,400.)
Meanwhile, Gary Cohn and Treasury Secretary Steven Mnuchin are going in the absolute opposite direction. Their aggressive goal is to slash the corporate tax rate.
- Cohn and Mnuchin aren’t bluffing when they say they want to slash the corporate tax rate to 15% from the current 35%. Neither man has any interest in timid tax cuts, and they wager that special interests will relinquish their loopholes if they become convinced their tax rate really will be in the teens.
And if that doesn’t happen in 2017?
Cohn has said he will walk.
If true, then it would prove just how seriously Cohn is about seeing these tax cuts happen.
So why is Bannon pushing against those Trump brought on board to work through the very complicated issues of budget and taxes?
Because, as some have speculated, it would be just the kind of populist message he’s hoping to promote. It would be popular, as some polls have suggested that the majority see the wealthy as not paying enough, and it would likely meet his goal of driving Cohn out.
- Some top Republicans have come to believe, contrary to conventional wisdom, that tax reform stands a better chance if health care fails — so desperate will Trump and Republican leaders be for a victory.
That makes sense. Given what we know about the current version of an Obamacare repeal bill, nobody wants it, and it will likely fail.
That’s a black eye the administration will be looking to fix, right away.