U.S. Rep. Dan Webster, R-Clermont, represents District 11, which includes Hernando and Citrus counties. The higher growth, officials say, would help create 12 million new jobs over the next decade. The Big Six tax-reform framework responds to these challenges by reducing the already low federal tax burden on the middle class even further. John F. Kennedy proved it. Ronald Reagan proved it.
Backers of the plan, which is focused on a large cut to the rate paid by USA corporations, said the state and local tax deduction mostly helps the wealthy and that the middle class will come out better overall because of other proposed changes, including nearly doubling the standard deduction.
"Over time, this double taxation is going to erode and weaken our local tax base", Landrieu said. First, the gross national debt - almost $19 trillion - is far larger than when Reagan or his successors tried the strategy. Second, the domestic labor market is much tighter, with unemployment at a 17-year low. We need tax relief and we need it now. And that means being reliable to the interests of the wealthy. But they'll back him as long as they think he might get those tax cuts through.
"I would expect to see an immediate jump in wage growth", Hassett said in a phone call with reporters, saying that the salary gains would also come in part from companies bringing back profits held overseas to avoid the relatively high USA tax rates. That guiding principle should not be lost today under the guise of 21 century economic needs being substantially different than 31 years ago. Firms have chosen to move production overseas, reducing demand for USA workers. Had the corporate tax rate changed in 2008, the comparable growth rates would have been 2.0 percent per year for median real household income and 2.4 percent per year for average household income. During recessions in 1981 and 2009, politicians pushed through tax breaks to give a shot in the arm to consumers and businesses. Corporations pay a tax on income, and then shareholders pay another tax on the same income. By lowering the corporate tax rate, we encourage investment and spur competition.
The average household brought home $83,143 in income a year ago.
Mike Pence is the vice president of the United States. It's a concept known as "supply-side economics", which many Republicans have embraced, including Reagan. Business investment and startup activity have been unusually sluggish this last decade.
No one knows for sure why US business investment has been so lackluster over the last decade. Laura Tyson, CEA chair during the Clinton administration and economic advisor to the Obama administration, says that Hasset's claim is "disturbing" and "dishonest".
Eric Zwick, a University of Chicago economist who studies public policy and corporate behavior, thinks it's a combination of technology, globalization and policy considerations that has made it less attractive for companies to invest in the US than elsewhere.
The best evidence of the positive effects of tax cuts comes from states like Indiana.
The "small businesses" that will be helped most by the Republican tax plan are so-called pass-through businesses.
But that decision hinges on many other factors too, he added, not the least of which is that business activity remains robust. But Hassett said enough details are now known about the plan to support his conclusion that it would lead to income gains and stronger economic growth. Everyone wants to pay less in taxes, of course.
"I would expect capital spending to really take off if the tax bill passes", Hassett said.