Republican leaders promised tax reform would streamline things so much that 9 out of 10 Americans could file their taxes on a postcard.
It’s not that simple for David Fraser.
He has four children, four rental houses, a small business, and no idea how the tax bill will shake out for him and his family. But living in Illinois, which has high income and property taxes, he has the sense he’s not going to come out on top.
“We may finally be forced to move out of state. This hurts tremendously. I am waiting for [Congress’s] final bill before I meet with my CPA to assess the potential damage,” he says. “That being said, I still think the corporate rate cut is justified.”
From policy analysts to journalists, many have criticized President Trump’s tax bill as hurtful to middle-class Americans, and a betrayal of his populist campaign promises – particularly since tax cuts for individuals are set to expire after 2025. And indeed, that could be a liability in the next elections among a key segment of GOP voters. But polling and Monitor interviews reveal that a broad spectrum of Republicans in fact support the bill – even if it’s not great for their own bottom line.
In many cases it is a lukewarm support, not least of all because Republican leaders have done little to address the other side of the equation: government spending and the ballooning national debt.
“We are on an unsustainable path,” says Mr. Fraser. “Too many times, Republicans campaign on fiscal conservatism, but once they get into office, they find ways to spend money we do not have. I believe tax cuts will help on the revenue side, but spending must be curbed.”
Varied opinions in conservative ranks
Democrats have been largely united in their opposition to lowering taxes on corporations and wealthy Americans, but Republicans were much more divided ahead of Congress’s tax bill votes, according to a Pew Research Center survey published in September.
While 41 percent of Republicans or those who lean Republican supported lowering taxes for corporations, 32 percent supported raising them. When it came to Americans making more than $250,000, there was a similar gap: 36 percent in favor of easing their tax burden, 26 percent opposed.
Now that versions of the tax bill have passed both the House and Senate, the GOP is closing in on its first major legislative victory since Trump’s election. On Friday, congressional Republicans announced they had finalized the reconciliation between the two versions passed by both houses of Congress. More than two-thirds of Republicans say they approve of the bill, according to a recent Gallup poll.
Mark Anthony, co-host of the conservative talk radio show, Patriot and the Preacher, says most of the listeners who have called in lately are business owners and executives who are excited about the corporate tax cut “because they believe that’s going to stimulate hiring and innovation – that’s a good thing for the economy.
“What they’re not excited about … is this language coming from the other side: It’s the end of the world, it’s Armageddon, 10,000 people are going to die,” he says, the latter a reference to the dire prediction about the impact of removing the individual mandate, which requires people to have health insurance or face a tax penalty.
It’s not just Democrats who worry about the impact.
“The only thing the government does is screw the working people,” says Scott, a Trump voter from Georgia contacted by email, who asked that his last name not be published. He says he’ll do everything he can to vote Republicans out of power in 2018. “What is the next step, short of armed insurrection?”
It’s average workers like Scott who helped Trump win the election in key battleground states like Wisconsin and Ohio, and a loss of their support could bode ill for Republicans in 2018 and 2020 – especially if the president doesn’t deliver on other key election promises.
“If Donald Trump is running for reelection and basically there’s been no infrastructure built, no wall, trade deals are roughly the same, people are still getting laid off because of foreign competition and the tax bill hasn’t given them anything at all, I think a lot of the economic populists are going to look up and say … we put our faith in this guy, it didn’t work. Does somebody else seem to be offering us something different?” says Henry Olsen, coauthor of The Four Faces of the Republican Party and the Fight for the 2016 Presidential Nomination and a senior fellow at the Ethics and Public Policy Center in Washington.
As the House-Senate conference committee worked to finalize the legislation, some of the sticking points involved how friendly the bill would be to average households. On Friday, Republicans announced they had enlarged the child tax credit for low-income families, in response to a threatened no vote by Sen. Marco Rubio of Florida, who said he wanted to see working-class families benefit more from the overhaul.
One family's tax tally
Trump voters Chris Fleissner, a CPA in Wisconsin, and her husband Dick, have been particularly watchful about how much they’re paying the government. One year they saved every single receipt, crunched the numbers, and calculated that between Social Security, Medicare, state income tax, federal income tax, excise tax, gasoline tax, and sales taxes, they were paying more than 48 percent of their income to the government.
When they do the numbers on Trump’s proposed tax cuts, Ms. Fleissner says, it goes something like this: They currently get a standard deduction of $12,700, plus a personal exemption of $4,050 each, for a total of close to $21,000 shielded from federal income tax. So the proposal to raise the standard deduction to $24,000 doesn’t do much for them.
“I don’t feel like we’re getting a tax break,” says Fleissner. But despite that, she still thinks overall the bill will be good for America because it’s important to cut corporate taxes – a move supporters say will make American businesses more competitive globally.
And while many decry Trump’s giving corporations a tax break that they’ll just pass on to their stockholders, retiree Mack Teasley in Abilene, Kan., notes that includes most average participants in retirement plans.
“In this day and age, any American who has a 401(k) … they are a stockholder, whether they realize it or not,” says Mr. Teasley, a retired Air Force intelligence officer and former deputy director of the Eisenhower Presidential Library who has voted Republican for 45 years.
He’s optimistic about the bill’s impact on average Americans. But when it comes to fiscal responsibility, he admits the Republicans have changed their tune to avoid becoming a minority party.
Indeed, four years ago, 7 in 10 Republicans said the budget deficit should be the top priority; today, only 37 percent hold that view, according to the 2017 American Values Survey released Dec. 5. According to the nonpartisan Congressional Budget Office, the tax bill would increase the deficit by $1.4 trillion.
For Travis Sawyer, a young Republican in Abilene, the national debt is such a pressing issue that he’d be willing to forgo the money he’d get from tax cuts in order to stabilize America’s finances.
“I am a fan of tax cuts…. I love being able to keep more of my own money,” says Mr. Sawyer, a financial adviser who guesstimates that he would likely get a couple thousand dollars back if Congress finalizes the tax bill. “Two thousand dollars would be great, it would make next Christmas phenomenal…. But I would have zero issues not seeing a penny of that if I knew that we were actively paying down the debt.”