The tax part of the Manchin deal
I've been looking at the early documents on the tax aspects of this week's sudden deal between Joe Manchin and the rest of the Democratic Party. Aside from a bunch of energy-related tax credits, the only changes I can see are (1) bringing back the 15 percent corporate minimum tax (which the Turtle and Orange Caligula scrapped in '17) and (2) tightening up the obscene "carried interest" loophole through which hedge fund honchos and private equity managers like Mitt Romney pay cut-rate taxes on their compensation for services rendered. As for the rest of the über-wealthy, they will skate away with no increase in their taxes.
And I wouldn't bet on even the wimpy stuff I just outlined going through. The other leading fake Democrat in the Senate, Vertité Sinema, hasn't signed off yet, and she's historically been opposed to closing the hedge fund loophole. Meanwhile, running the tax show in the Senate is Ron Wyden, a toothless Finance Committee chairman to whom nobody listens much, particularly not people like Sinema.
So even if Manchin doesn't back out, which he's done before, the tax part of the deal won't be much, and it might not turn out to be anything.
Cynicism and skepticism are always in order related to tax policy, but I have to disagree that the "carried interest" thing isn't much if it makes it into law. Say what you like about symbols and empty symbolism, but there is simply no more damning symbol of the capture of our government by the forces of greed and corruption than the carried interest loophole. It is a major, major step in the right direction. Sure, many more are needed, but the first one -- the one that actually changes the direction things have been going -- is always the hardest.
ReplyDeleteThey've been jerking around over carried interest for decades. They actually acted like they did something in '17, but they didn't really. If that and a corporate minimum tax is all they get done, it's laughable. Don't kid yourself, Manchin and Sinema flushed the whole party agenda down the toilet.
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