Sunday, January 26, 2025

Bill Crawford: Trump Tax Cuts Make Legislature's Look Tiny

Congress is about to horn in on our tax cut debate. Up against Congress’ $4 trillion plus issue our $2.2 billion in tax cuts looks tiny.

President Donald Trump is pushing Congress to not only sustain tax cuts from his 2017 Tax Cuts and Jobs Act (TCJA) but to add to them.

The TCJA cuts will expire this year unless Congress extends them. Over ten years the projected cost to extend would be the $4 trillion.

Expiring benefits include higher standard deductions and lower tax rates for individual taxpayers, the pass-through small business tax deduction, and higher child tax credits, estate tax exemptions, and alternative minimum tax exemptions.

Corporate tax cuts are not expiring. They were made permanent in 2017 while the individual tax cuts were not. However, the President now wants to lower corporate rates from 21% to 15%.

He has also called for eliminating taxes on Social Security, overtime pay, and tips. Along with a corporate tax reduction, all these would almost double the $4 trillion cost.

Naturally, the President wants this all done sooner than later. So, Republicans in Congress are moving quickly to utilize the controversial budget reconciliation process, which avoids Senate filibusters and can affect entitlement spending, to push a bill to passage.

Debate is already hot and heavy over what to include in the reconciliation bill and how to offset the costs. With the federal debt now exceeding $36 trillion and the latest annual budget deficit exceeding $1.9 trillion, deficit hawks are pushing hard for the reconciliation bill to include massive spending offsets to avoid additional debt.

Those offsets could have significant impact in Mississippi which depends on federal funds for well over 50% of its annual budget. Particularly at risk are funds for education, healthcare, and agriculture.

For reference, about 61% of the annual federal budget (about $4 trillion) goes for mandatory spending. That includes Social Security (22%), Medicare (13%), Medicaid, CHIP, and ACA (11%), agriculture (1%), and other income support programs (14%).

Another 28% (about $1.7 trillion) goes for discretionary spending. That includes defense (13.5%), Veteran’s benefits (2.1%), education (2.0%), transportation (1.9%), non-mandatory health (1.6%), international affairs (1.4%) and various other federal departments and agencies (5.9%).

The final 11% (about $700 million) goes for debt service (2023 numbers).

All this makes the Mississippi Legislature’s debate over $2.2 billion in personal income tax cuts phased in over 12 years seem like small potatoes. It will become big potatoes for many if federal budget cuts play havoc with our future tax revenues.

“Since no one knows the future, who can tell someone else what is to come” – Ecclesiastes 8:7.Congress is about to horn in on our tax cut debate. Up against Congress’ $4 trillion plus issue our $2.2 billion in tax cuts looks tiny.

President Donald Trump is pushing Congress to not only sustain tax cuts from his 2017 Tax Cuts and Jobs Act (TCJA) but to add to them.

The TCJA cuts will expire this year unless Congress extends them. Over ten years the projected cost to extend would be the $4 trillion.

Expiring benefits include higher standard deductions and lower tax rates for individual taxpayers, the pass-through small business tax deduction, and higher child tax credits, estate tax exemptions, and alternative minimum tax exemptions.

Corporate tax cuts are not expiring. They were made permanent in 2017 while the individual tax cuts were not. However, the President now wants to lower corporate rates from 21% to 15%.

He has also called for eliminating taxes on Social Security, overtime pay, and tips. Along with a corporate tax reduction, all these would almost double the $4 trillion cost.

Naturally, the President wants this all done sooner than later. So, Republicans in Congress are moving quickly to utilize the controversial budget reconciliation process, which avoids Senate filibusters and can affect entitlement spending, to push a bill to passage.

Debate is already hot and heavy over what to include in the reconciliation bill and how to offset the costs. With the federal debt now exceeding $36 trillion and the latest annual budget deficit exceeding $1.9 trillion, deficit hawks are pushing hard for the reconciliation bill to include massive spending offsets to avoid additional debt.

Those offsets could have significant impact in Mississippi which depends on federal funds for well over 50% of its annual budget. Particularly at risk are funds for education, healthcare, and agriculture.

For reference, about 61% of the annual federal budget (about $4 trillion) goes for mandatory spending. That includes Social Security (22%), Medicare (13%), Medicaid, CHIP, and ACA (11%), agriculture (1%), and other income support programs (14%).

Another 28% (about $1.7 trillion) goes for discretionary spending. That includes defense (13.5%), Veteran’s benefits (2.1%), education (2.0%), transportation (1.9%), non-mandatory health (1.6%), international affairs (1.4%) and various other federal departments and agencies (5.9%).

The final 11% (about $700 million) goes for debt service (2023 numbers).

All this makes the Mississippi Legislature’s debate over $2.2 billion in personal income tax cuts phased in over 12 years seem like small potatoes. It will become big potatoes for many if federal budget cuts play havoc with our future tax revenues.Congress is about to horn in on our tax cut debate. Up against Congress’ $4 trillion plus issue our $2.2 billion in tax cuts looks tiny.

President Donald Trump is pushing Congress to not only sustain tax cuts from his 2017 Tax Cuts and Jobs Act (TCJA) but to add to them.

The TCJA cuts will expire this year unless Congress extends them. Over ten years the projected cost to extend would be the $4 trillion.

Expiring benefits include higher standard deductions and lower tax rates for individual taxpayers, the pass-through small business tax deduction, and higher child tax credits, estate tax exemptions, and alternative minimum tax exemptions.

Corporate tax cuts are not expiring. They were made permanent in 2017 while the individual tax cuts were not. However, the President now wants to lower corporate rates from 21% to 15%.

He has also called for eliminating taxes on Social Security, overtime pay, and tips. Along with a corporate tax reduction, all these would almost double the $4 trillion cost.

Naturally, the President wants this all done sooner than later. So, Republicans in Congress are moving quickly to utilize the controversial budget reconciliation process, which avoids Senate filibusters and can affect entitlement spending, to push a bill to passage.

Debate is already hot and heavy over what to include in the reconciliation bill and how to offset the costs. With the federal debt now exceeding $36 trillion and the latest annual budget deficit exceeding $1.9 trillion, deficit hawks are pushing hard for the reconciliation bill to include massive spending offsets to avoid additional debt.

Those offsets could have significant impact in Mississippi which depends on federal funds for well over 50% of its annual budget. Particularly at risk are funds for education, healthcare, and agriculture.

For reference, about 61% of the annual federal budget (about $4 trillion) goes for mandatory spending. That includes Social Security (22%), Medicare (13%), Medicaid, CHIP, and ACA (11%), agriculture (1%), and other income support programs (14%).

Another 28% (about $1.7 trillion) goes for discretionary spending. That includes defense (13.5%), Veteran’s benefits (2.1%), education (2.0%), transportation (1.9%), non-mandatory health (1.6%), international affairs (1.4%) and various other federal departments and agencies (5.9%).

The final 11% (about $700 million) goes for debt service (2023 numbers).

All this makes the Mississippi Legislature’s debate over $2.2 billion in personal income tax cuts phased in over 12 years seem like small potatoes. It will become big potatoes for many if federal budget cuts play havoc with our future tax revenues.

“Since no one knows the future, who can tell someone else what is to come” – Ecclesiastes 8:7.

Crawford is the author of A Republican’s Lament: Mississippi Needs Good Government Conservatives.

21 comments:

Anonymous said...

About 42% of the money for state funded services came from the federal government last year. ($13.2 billion). $89 million was earmarked for MDOT money and infrastructure repair $1.2 billion. Our members in Congress got us another $220 million in grants. The US 82 Greenville by-pass alone was $216 million.

So, someone needs to ask "If we don't get federal dollars and there's no state tax, how will we make any infrastructure repairs or pay the current salaries of government workers at the same level (local fire and law enforcement salaries are supplemented by federal dollars and have been for decades or if that's where the money for the Capitol police and their equipment originated.)

37% of the budgets for state colleges and universities come from federal and state taxes not counting grants for students. Lots of our skilled labor were trained by the federal Pell grant...the Junior College system depends on those grants.

Now, look at local taxes and local "improvements" in your county and town budgets and the local salaries if you are brave enough.

I wonder if some of you will understand why things start losing the things you took for granted.

Anonymous said...

Power to, from, of, and by the people.

Huge error in the first third of this diatribe by Crawford: Spending may be called "mandatory" but that does make it so. Going forward, every tax dollar should be considered "discretionary"....because it is in fact.

Anonymous said...

We definitely need more billionaires and a few trillionaires more than spending taxpayer funds on Social Security, Medicare, education, Medicaid, etc. Corporate welfare is much more important than the welfare of the citizens.

But hey, this is what America wanted.

Anonymous said...

That there would be hard work thinking about all this stuff you are saying. Too many numbers and a lot of fine print. Who do you think has time for that in the 'Sip?

It would be smarter to elect Shad governor. He spent $2 million and found $350 million.

Let him spend about $10 million with the consultants he knows and he'll come up with enough couch change to do a buyout of Commiefornia!

Anonymous said...

The rich will keep more of their money. The poor will suffer greatly. It's biblical.

Anonymous said...

It is inevitable they will run out of our money to spend! I’m sick of it!

Anonymous said...

Correct @11:51.
God Chose some to rule and chose some to serve the rulers. I am grateful to have been born into a family of Chosen rulers.

Anonymous said...

If the people could open up some of the slush funds the politicians like to keep secret it would help. Just the one account that holds the income tax that is not returned because of questionable SS numbers would make a big difference. We used to be able to learn how much was in that account but it got so large that the politicians hid it from us.

Anonymous said...

I counted 21 One-Sentence paragraphs. Obviously, AI generated! That's an insult to all who ever took English Comp.

Anonymous said...

Taxes??? We just need the "innovative" private sector to take over Gubmint, right???

Interesting reveal out West where the LA Fire Department had half their trucks in the shop and new firetrucks now cost 2 million and take 4 or more years to deliver. Parts are in short supply. Why? Private equity bought up all the fire apparatus companies. No competition, cartel type high prices, less productivity. And that's happened in our Emergency Rooms. But, no mind. The Hollywood elite literally has been having 200k private fire hydrants built outside their mansions. And, things were great until the whole town burned down and the precious private hydrant ran dry and there were not enough trucks.

So, when a healthcare CEO gets shot or a celebrity's home is on fire, private equity is in St Bart as the disaster unfolds. Naturally, the RINO MS GOP wants a billionaire for Gov so we can be like Cali. Private profit, public loss, and Uncle Sam GubMint Welfare for Farm Corporations, pumps for your Fed made swamp fields, and subsidized flood insurance.

Boy, 'Murica is getting better every day ain't it? Only now it's little towns in Kansas that can't afford a fire truck, and fires are killing folks quicker. 8X faster. So, who needs fire trucks when we have crypto trillionaires and PE on the job!?!?

Anonymous said...

You will never...EVER...see career politicians pushing for deep tax cuts and reduction of government. It takes a non-politician running and being elected president to make bold moves that may seem shocking to statists, but for the people trying to make ends meet with prices soaring....it's a breath of fresh air. And frankly, it's precisely what the people voted for in the recent election.

Anonymous said...

By rich, do you mean the people who actually earn the money and want to keep as much of their money as possible? Considering the recent economy and inflation, it makes sense to want to keep as much of your income as possible.

Anonymous said...

Doing away with Federal Department of Education, as Trump has proposed, would be a significant financial savings.

Anonymous said...

One thing Mississippi proves above all else: Just how grate a state can be without all that fancy edumacation.

Anonymous said...

Privatize the Post Office. I got an invitation in the mail yesterday for an event in December. It was post marked November 4.

Anonymous said...

1:45 NO, that's not rich. The rich don't have to just WANT to keep their money. They pay people who make sure they keep their money.

Anonymous said...

Trump will bankrupt America.

Anonymous said...

You are ranting about half of the problem with the fires in California. If they had simply followed the old practices of burning the dead under brush of wooded areas, the fire danger would have more than likely been avoided.

Anonymous said...

@2:33pm wins. Just look at most of these comments.

Anonymous said...

The national debt is over 33 trillion dollars, but Trump is going to bankrupt America?? Get out of here with your ignorance.

Just a normal dude said...

All this debate and nobody points out that Kingfish posted the original article three times in a row?



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In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.


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If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

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