By Kenneth Paigen
In the last issue of the Islander, State Sen. Langley penned a vigorous defense of Sen. Collins for her vote for the recent tax bill, criticizing the impassioned criticism of her vote by many constituents. Langley described Collins as “standing up for what she thinks is good public policy regardless of which side of the aisle proposed or sponsored the legislation” and “Collins does her homework, clearly understands the issues and votes in the best interest of the state of Maine and the United States of America.”
I have no reason to question Langley’s personal assessment; he knows Collins much better than the rest of us, who know her only by her actions. But the question is not how conscientious Collins was in evaluating the tax bill, but how well her efforts succeeded in serving the best interest of the state of Maine and the United States of America.
How well did she serve her constituents? Unhappily, the answer is not well at all if we are to trust the bipartisan, nonprofit Tax Policy Center, an organization established jointly by Republicans and Democrats.
Collins was clear that she only voted for the tax bill after receiving assurances that remedial legislation would soon follow to repair some of the damage the bill inflicts on the health care system. But there was a far more effective way to prevent such damage: vote against the bill in the first place.
So we can only conclude that Collins was willing to accept some damage in order to achieve the tax goals of the bill. The Tax Policy Center’s analysis, which is easily available at their website, concluded that the bill was highly regressive, strongly favoring the wealthy over the rest of the country. The immediate tax benefits steadily increase in value from the poorest to the wealthiest, and this in a country already suffering from increasing income inequality.
The benefit for the wealthiest 1 percent is 2-1/2 times as great as that for those at the bottom, percentage-wise, and vastly greater dollar-wise. And by 10 years out, the time span of this bill, virtually all of the tax benefit goes to the top 1 percent. Does that serve the best interests of our state and country?
The other half of the tax benefit goes to corporations, whose tax rate will drop from 35 percent to 21 percent. The theory is that corporations will now use these additional profits to invest and expand, creating new jobs and economic growth. But there already is more than enough money available for corporations to expand if they want to. Corporate profits are at record highs, and investment money is readily available at record low interest rates.
What holds them back now is the lack of additional demand for their products. If we truly wanted to stimulate the economy, the tax bill would have provided the bulk of tax relief to lower- and middle-income families. Spending that money would create additional demand for economic expansion. Trickle up is far more effective that trickle down. If we can believe the historical record of the multiple tax cuts over the last half-century, the bulk of the increased corporate profits will be distributed as stock dividends, creating another benefit that will flow to the wealthiest among us.
The tax bill achieves all this by adding $1.5 trillion to the national debt. If we had decided to borrow that much money for the benefit of our country, imagine what it could buy in terms of education, health care, care for the elderly, investments in research to create new economic opportunities, providing cleaner air, water and renewable energy, and repairing our failing infrastructure, all of which would create new jobs and new opportunities.
So what are we to think of Collins’ vote for the tax bill? We can only conclude that despite her best efforts, she failed to understand the larger implications of the bill. Either that, or she did understand and chose to vote in favor of the very wealthy over the rest of us.
Langley does not think it appropriate for us to criticize Collins so vociferously. He is wrong. Not only do we have the right to voice our objections, we have an obligation, a responsibility, to do so. Beyond the dollars involved, this tax bill is a callous attack on our democratic values. It is borrowing an immense amount of money to gift to the wealthiest among us money that the rest of us eventually will have to pay back. We can only hope our good senator listens to our voices.
Kenneth Paigen is a professor at The Jackson Laboratory. He lives in Bar Harbor.