- Hey everybody, welcome to Facebook live.
We're coming to you live from Indivisible headquarters.
Tonight we're gonna be talking about the Trump tax scam.
It's our next big fight in congress,
so hope everybody's ready for that.
First two things you can do right now.
Share this video so that your friends see it
in their Facebook news feeds and so that they can learn
about the Trump tax scam as well, and put your questions
in the comments so that we can answer them
later in the Facebook live.
I'm Chad Bolt.
I'm a policy manager on the policy team here at Indivisible.
- Hi, I'm Whitney Roberts.
I'm on the organizing team and I work
with most of the southeast and Appalachia.
- And I'm Chye-Ching Huang and I'm with the center on budget
and policy priorities and I do tax policy as a day job.
- It's one of the best day jobs there is.
- It really is.
- I'm really excited to have you back Chye-Ching,
back by popular demand and fresh off your testimony
before members of the house of ways
and means committee about the Trump tax scam.
So really excited to have you here to talk about it with us.
- Good to be here.
- Before we get to that just really quick as always,
want to shout out our newest Indivisible group.
This is Colorado College Dems in Colorado Springs.
They're joining 234 other Indivisible groups in Colorado
and they're gonna be holding
congressman Doug Lamborn accountable.
Welcome to the Indivisible family Colorado College Dems.
I'm gonna put your sticker on the map.
I'm gonna flawlessly find Colorado Springs on the map.
Boom. - Nicely done.
- Thank you.
All right, and Whitney, you've got some group shout outs.
- Yeah okay, so first of all, happy Indigenous People's Day.
Today we have one of our groups, Indivisible Tahono.
They set up a pop up store, having books
and different merchandise but more importantly,
they've been working to resist the Trump border wall
that runs through their travel lands.
We've also got Indivisible San Diego,
who all have 100 person demonstration
taking a knee in support of Colin Kaepernick,
and finally a shout out to all of our groups
that have started doing Trump tax scam protests
and actions including Indivisible Phoenix,
who held a giant fabric penny that they displayed
from outside Jeff Flake's office
and also all of my groups, 'cause they're always great.
(laughing)
- That's awesome.
We've got a ton of groups gearing up for the tax fight.
I love the Indivisible Phoenix penny
that's now hanging outside of Jeff Flake's window
to symbolize our ask, which is not one penny in tax cuts
for millionaires among other things.
Great, so that is actually a great segue
into the topic of the night, the Trump tax scam.
So first, just to set the record straight,
you've probably heard republicans talk
about this as tax reform.
They're saying we haven't really done it since 1986.
The time for tax reform is now.
What they're doing is not tax reform.
Calling it that suggests that they were
maybe closing loopholes or addressing
the serious wealth and racial inequality
that's fueled by the current tax code.
That's not what they're doing.
They're just cutting taxes for the rich and corporations,
meanwhile telling people that it's
about the middle class and small business.
So we're not calling it tax reform.
We're calling it what it is, the Trump tax scam.
We've talked about this on Facebook live before.
Chye-Ching, you were with us.
There have been a couple new developments
since the last time we had you here
and the last time we talked about this on Facebook live.
The biggest one is that the republicans have put out
a more substantial framework, and I say that
because it's relative to the one page document
that they put out in April.
I think now they've put out something
that's about seven pages long.
So they're getting a little more specific,
although there's still a lot left to figure out,
details that are really important
in particular for the middle class.
But here's what we know:
it's like I said, all about tax cuts
for the rich and corporations.
They want to lower the tax rate
for the wealthiest individuals.
The plan repeals the estate tax, which only applies
to families worth more than $5.5 million.
I don't know about you Whitney.
That's not me. - No, it's not me.
- Per person, if you're a couple you get double that.
- That's true, if you're a couple
the threshold is $11 million.
So we know who that benefits.
They want to repeal the alternative minimum tax,
which ensures that the wealthy can't exploit their way
to paying little or no tax.
It's actually very important to Donald Trump himself.
What we do know about his tax returns,
the one leaked return that we have from 2005,
we know that he would have paid a tax rate
of something like 3 or 4% had it not been
for the alternative minimum tax.
So shock of all shocks, he wants to repeal that
for himself and his wealthy friends.
So those are just a couple of the highlights
about what's in the tax scam itself,
but it's really important to understand the process
that republicans are gonna use to pass the tax scam.
It's a two stage fight and Chye-Ching,
I'm gonna let you talk a little bit more about the process.
- Right, thanks.
So the first step towards a really bad tax bill
that the tax policy center estimates will deliver 80%
of its benefits to the top 1%.
That's quite a lot.
- That's ridiculously tilted in one direction.
- The first step towards that is the budget resolution.
So to just remind you, congress' budget resolution
isn't a law, but it does do two really important things.
The first is that it sets out the republican majority's
long term vision, and as we know,
that vision is large tax cuts
for the wealthy and corporations.
It's also deep cuts to Medicaid, to Medicare,
and a host of other critical programs.
They also cut deeply the part of the budget
that funds education, infrastructure,
environmental protection, housing assistance, food safety,
a number of other really critical public investments.
The second thing that a budget resolution does
is it can kick off this process called reconciliation.
Now reconciliation is what republicans want to use
to try within the next few months
to achieve a big chunk of their long term agenda.
Now reconciliation allows them to move a budget bill
through congress with only 50 votes
plus the vice president and the senate.
- Right. - This is sounding familiar
because this is exactly the same process they used
to try to repeal the Affordable Care Act.
Now they want to use it to try and achieve big tax cuts.
- And we all know what happened there.
They weren't able to do it.
- So let's give that another go.
(laughing)
But again, the first step towards this process is
that they have to get this budget resolution.
It's the first step towards a really bad tax bill.
Where are we now in this process and what happens next?
Well the house has already passed its version
of a budget resolution and the senate is next week
about to vote on its version.
They're gonna have to come together at some point
and try to agree on the same version, but right
in front of us next week is the senate version
that they're going to vote on
and this is something that your senators should oppose.
The senate version of the budget resolution
would allow congress to put on the reconciliation fast track
a tax bill that cuts $1.5 trillion
from taxes and adds that to the deficit.
Now that's over 10 years, but that's a lot.
- That's a big number. - That's a big number,
and here's where it's really important
to pause for a second and remember why
the broader budget resolution vision is important.
Now the house, the senate, and President Trump have all said
that they justify their big cuts to Medicaid, Medicare,
and a host of other programs by saying
that those cuts are needed to address current deficits.
So we should take that as a really clear
and pretty important serious warning about what would happen
if they were to be able to enact $1.5 trillion worth
of tax cuts that enlarge deficits even more.
That's a really clear sign
of what spending they're gonna target when they come back
and say deficits have exploded
and we now need to address the deficit.
They could come back as soon as next year
and demand those budget cuts
in response to those added deficits.
- This should also sound familiar
because we've seen republicans pass a deficit busting
tax cut bill before as the Bush tax cuts in '01 and '03.
Huge tax cuts paid for in exactly the same way,
by adding to the deficit and then President Bush turned
right around and said, "Oh my goodness."
"Look at our deficits, it's such a problem."
"We have to privatize social security."
So that's really what's going on here.
We've seen it before.
We know he'll do it again.
So I think it underscores so much of the fight
over Trumpcare had to do with Medicaid.
It really underscores what you just said,
that the fight over Trumpcare is really
the same fight as the tax scam.
- Right, and they weren't able to achieve all of those cuts
that they wanted to to address deficits,
but we have seen deep cuts in non-defense,
the area of the budget that invests
in domestic appropriations, things like
education, research, and all sorts of headstart.
They've been under a multi-year squeeze and that's been
in part due to congress responding
to this cry to address deficits.
Not only is there a problem if they add $1.5 trillion
of tax cuts to deficits because down the road,
that just threatens critical programs.
The other problem is that we may actually see
some of those cuts to programs be enacted
in the very same bill as the tax cuts, and here's why.
Now the senate budget resolution actually allows congress
to use reconciliation to pass fast track cuts to Medicaid,
to Medicare, and to any of the other programs
that are within the jurisdiction
of the senate finance committee.
So those are a number of big targets right there.
To make that sort of even more problematic,
every dollar that they cut from Medicaid, Medicare,
and those programs, they can use to pay
for an additional dollar of tax cuts
on top of the $1.5 trillion.
- Yeah, so bonus tax cuts essentially is what you're saying.
- Bonus tax cuts from cutting critical programs.
- Yeah.
- So that's why we need senators
to really oppose this budget resolution.
They should oppose it because it paves the way
for revenue losing tax cuts that threaten critical programs
down the road and they should oppose it
because it sets up this fast track for cuts
to Medicaid and other critical programs right up front.
- Yep, wow.
All right, so this is pretty terrible,
but again, it sounds a lot like our fight over Trumpcare.
They're really playing from the same playbook.
- Mm-hmm (affirmative).
- Trumpcare was about tax cuts for the rich,
buried hidden in their healthcare bill.
So that's the first way they're similar.
The healthcare bill would've paid
for it by cutting Medicaid.
That's exactly what'll happen here.
It's the same partisan reconciliation process.
It's the same constant shell game of,
"We don't know if that's in the bill."
"We haven't decided what we're doing with that yet."
"Don't worry, we fixed that problem"
"that you're calling my office to oppose."
"Don't worry, we're gonna fix it."
That kind of shifty stuff is what we're sure to see again.
Trumpcare was deeply unpopular.
- Right. - I think at one point
as it was moving through the house
had a 16% approval rating.
Cutting taxes for the wealthy and corporations
is also deeply unpopular with the American people.
Something like 84% of people
think corporations don't pay enough in tax.
The Trump tax scam would slash
the corporate tax rate from 35 to 20%.
That's a huge difference, so I think once we get
into the questions we can talk a little bit more
about sort of myth versus fact and why this is a scam.
But I want to get us into the questions.
So don't forget--
- I should just mention though.
- Yes? - One other way that
it's exactly like the Affordable Care Act repeal approach
is that we do have multiple chances to try to stop this.
- Yes.
- So we're gonna try with the budget resolution.
Even if the senate passes its version,
they have to agree on a single version with the house.
We can try and stop it there too and again,
if they get that we can try and stop a really bad tax bill
later on down the process.
Again, that's where we should be asking lawmakers
to reject the tax bill that cuts taxes for millionaires,
for corporations, or that cuts Medicaid.
- Yep, okay so to recap, the most important ask,
especially for your senators right now,
is oppose to budget resolution.
Senate's on recess this week,
so catch them while they're back home in your state.
Tell them oppose the budget resolution.
They could vote on it as soon as next week.
- Yeah.
- The other way that this fight is exactly like Trumpcare
is that we've got everything you need
at indivisible.org and actually you should go
to our micro site trumptaxscam.org.
That's got call scripts, explainers.
It's got a map of Trump tax scam data specific to your state
so that you can find out just how much of a scam it is.
You can find out how many people are millionaires
in your state and then find out how much
of the tax scam benefits go to just the small sliver
of the population of your state that make over $1 million.
It's pretty astounding.
So with that, I think we'll get into the questions.
- Yeah.
- All right Whitney, take us away.
- All right, so first question comes
from Janet from South Carolina.
"Can we really win on this?"
"Republicans really want to pass tax cuts"
"and I'm afraid we will lose some dems."
- Ah, okay, that's true.
The possibility of democrats wanting to appear as bipartisan
or as if they're compromising I think is real.
So Janet, I think you're right to have some concern there.
Earlier in the year, democrats got together.
They sent a letter laying out their principles
for the tax plan and it was pretty high level stuff,
I think pretty agreeable stuff.
It was no tax cuts for millionaires.
It was the tax plan has to go through regular order,
like committee, hearings, and markups.
None of this secret stuff.
The tax plan can't threaten entitlements,
Medicaid, Medicare, social security.
- Adding to deficits, because that ultimately is
the same thing as threatening those programs.
- Exactly, so we got 45 out of 48 dems on that letter,
which is a good place to be because we did so well
under the Trumpcare fight in part
because democrats were unified from the beginning.
So it's really important that
we have the same unified front up front.
The three democrats that didn't sign that letter
are Senator Donnelly from Indiana,
Senator Heitkamp from North Dakota,
and Senator Manchin from West Virginia.
So it's doubly important that those senators hear
from you early and hear from you often,
that you don't support a tax plan
or right now the budget resolution
that sets up the tax plan that would add
$1.5 trillion to the deficit just
to give tax cuts to the rich and corporations.
I think once these senators,
once their constituents really understand what's going on
in this tax plan, that it's not about the middle class.
It's about giving tax cuts to the rich.
It's not about small business.
It's about lowering the tax rates for hedge funds,
private law firms, and the Trump organization.
I think those senators will come around,
and we definitely can win
to answer the other part of the question.
We've got a real opportunity on this first stage,
so yeah, I'll leave it there.
But for all the reasons that we've talked about earlier,
republicans are playing from the exact same playbook
that they used for Trumpcare and we won on that twice.
So I feel really good about our chances here, too.
- All right, this one is from Colleen from Kansas.
"My Kansas representative is claiming"
"that this tax plan is not the same as what was enacted"
"in Kansas, which was a disaster"
"and blew a hole in the state economy."
"What are your thoughts?"
"How do we counteract this argument?"
- Chye-Ching, can I-- - Sure.
- Ask you to take this one.
So you testified before members of the ways
and means committee two weeks ago
and I think they asked you there this kind of same question.
What happened in Kansas when they undertook
the very similar stuff that's happening in the tax scam?
- So the plan that the republicans in congress
and President Trump have all signed onto
shares the same DNA as the Kansas plan.
It is large tax cuts
that overwhelmingly flow to the wealthy.
Not only does it have some of the same DNA,
it has some of the exact same policies.
So one of the big Kansas tax cuts was a large rate cut
for so-called pass through businesses.
Now republicans both in Kansas and at the federal level
saying that this is for small businesses,
but more than 90% of real small businesses
would get nothing, whereas finance firms,
hedge funds, wealthy real estate investors
would get the bulk of the tax cuts.
- Like the Trump organization.
- Happens to apparently own 500 pass throughs.
- Oh my goodness.
- So same sort of overall tilt, same policies,
and in fact some of the same people were behind it.
Some of the key architects of the Kansas tax plan
have been advisors to President Trump
and the members of congress
that have been making this federal tax plan.
Of course the theory behind it is the same,
that you don't need to worry about the fact
that it's all adding to deficits
because this is going to supercharge growth.
But unfortunately for Kansas,
we've seen what happened there.
The much touted economic growth didn't happen.
Kansas lagged its neighboring states
and lagged the rest of the economy
and in the end, what happened was the budget squares
led to delaying road repairs, to closing schools early,
to cuts that hurt seniors and to a raft of other things
before Kansas finally reversed the bulk of the tax cuts.
- Yeah, I think that's the really important part
of the story is things got so bad in Kansas.
It was such a disaster for the state economy
that they had to undo everything they did.
- They being republican congress.
Republican majorities in the house and the senate
of Kansas overrode Governor Brownback's veto
in order to roll back those tax cuts.
- Gotcha, all right, next question.
- This is Maura from New Jersey.
"I want to know how much my rep, one of the richest men"
"in congress stands to gain by passing this scam."
- Maura, I think you're represented
by congressman Frelinghuysen. - That's it.
- Did I get the pronunciation right, Chye-Ching?
- Do you want to take this question?
- No, go for it, yeah.
- This is a great question.
This is one that I haven't dug into specifically myself.
I just want to give a shout out to my friends
at the Center for American Progress
and particularly Seth Hanlon who's been doing
some deep dives into Trump, his cabinet members,
and how other members of congress could benefit
from this tax plan.
We can tweet out some links after that,
but those are some great resources to look at.
- Yeah, absolutely.
Trump as we know has one of the wealthiest cabinets
in history, if not the wealthiest cabinet
and so they obviously stand to gain personally
from the Trump tax scam in an enormous way,
not to mention Trump himself.
One of the best asks that you can make to your members
of congress is to demand that Trump release his tax returns.
Certainly there's important reasons why we need
to see his tax returns related to the investigation
looking into his campaign's connections to Russia
and his personal connections to Russia.
Just on the tax scam front, he stands to benefit
in a way that is pretty unprecedented
from the very policies he's pushing through congress.
The American people deserve to know how he'll benefit,
especially given what we've seen from the one tax return
that we know of and how much he would benefit
just from repealing the alternative minimum tax.
But Maura, if you want to know how much
congressman Frelinghuysen would benefit
from the tax scam, you should ask him.
Can't hurt to ask.
Get a couple of your friends together.
Get a couple dozen of your friends together,
show up to his office and say we want
to see your tax returns because we deserve
to know how much you'll benefit
from this plan you're about to support.
- This one's from Shirley in Florida.
"I've heard other people calling this a scam too,"
"but it seems like this might be good for me."
"Are you sure it's a scam."
- Shirley, it's definitely a scam,
no matter who asks the question.
- I'm sorry.
- It's definitely a scam and Chye-Ching just touched
on one of the important ways.
They're talking a lot about how this is about small business
and it has to do with something
kind of wonky called pass through income.
So can you break that down for us Chye-Ching?
- Sure, so again, one of the things
that they're calling this so-called small business
tax cuts goes overwhelmingly to Wall Street investors,
to very large real estate investors, to professionals
in the lobbying industry, law firm owners,
people that tend to have very large amounts
of business income and tend to be very, very wealthy.
The way that this tax break is structured,
it wouldn't benefit more than 90%
of actual small business owners and in addition
to all of that, it creates a huge loophole
that would let high earners change their income
into so-called business income in order to get the tax cut.
So again, the opposite of tax reform.
It's opening up a huge new loophole
that would effectively make the top individual
income tax rates basically optional
for very high earners that have a decent accountant.
- Right, so what they propose to do is limit
the tax rate on pass through income at 25%.
- Mm-hmm (affirmative).
- The highest rate that somebody might pay right now is 39%,
but anybody who's a true small business
is probably around or below that 25% rate.
- True small businesses tend to be small.
- Exactly!
- So they're not facing the higher tax rates.
- Exactly, exactly.
So when you think of a small business,
imagine whether they are bringing in
over $400,000 in income.
That's the top tax rate of 39%.
So limiting it at 25 if you're already at 25 or below,
you don't benefit at all from the new limit.
It's just the top. - And the bulk of the tax cut
goes to those very, very high income firms
earning more than $50 million a year
that would get the bulk of it.
To your sort of broader point about the issue of
whether or not it's a scam, that's your language
but the question I can answer
is whether or not it's doing what's on the ten.
It's really, really not.
They're saying it's tax cuts for lower
and moderate income people, for working class people.
At the best, they get crumbs and we also know that
that means in the end, picking up the tab
for the tax cuts for the wealthy.
- Yeah, and I wanted to get into something else
on this point too because we've heard now republicans say
a lot about the so-called doubled standard deduction.
- Mm-hmm (affirmative).
- The standard deduction as I'm sure most people
watching this have claimed the standard deduction
at some point or another in their life.
It is an amount of money that you can take
off of your income that is taxable.
Republicans are making a big deal about
that they're doubling it, but the problem is
they're giving with one hand and taking away with the other
because they're eliminating exemptions
that families can take for themselves
and the children that they have,
and they increased the tax rate at the bottom.
So it sort of washes out the number one
thing that republicans say that
they're doing for the middle class.
- So it's really, really clear at the top,
clear specific tax cuts that are worth a lot of money.
80% of total tax cut goes to the top 1%.
For low and moderate income people, they like to talk
a lot about doubling the standard deduction,
increasing the child tax credit,
but don't like to talk about the fact
that other provisions of the plan
mostly just claw that back so it's a wash.
- Yep, that's a really great point, Chye-Ching.
It's very specific on what they're doing for the wealthy
and what they're doing for the middle class,
"We'll fill in the details later."
"Don't ask us about the brackets."
"Don't ask us by how much we're gonna"
"increase the child tax credit."
"We haven't figured that out yet,"
"but we do know exactly what we're gonna do"
"for the rich and corporations."
So I think we've got time for one more question.
You want to, I think Judy's got a good one.
- Okay, all right.
Judy from Virginia, "What is the alternative minimum tax"
"and why do republicans want to repeal it?"
- So the alternative minimum tax was first enacted
to make sure that high earning people didn't claim
so many deductions and tax breaks
that they didn't really pay any federal income tax.
So that's its main purpose in the tax code.
Some tax plans that would simplify the tax code
and do other things that raise the same amount
of revenue and were just as progressive
could repeal the AMT and be responsible,
but this is not that plan.
It repeals the AMT and it also gives a whole lot
of other tax cuts and tax breaks to high income people.
As Chad mentioned before, one of the key examples
is that people that have looked at
President Trump's 2005 return have come to the conclusion
that virtually the only reason
that he paid substantial income tax
in that year was because of the alternative minimum tax.
- Exactly.
All right, so we know we've got a lot of bad stuff
in this tax plan, but we also have an opportunity right now.
The senate's on recess.
Again, the ask is to your senators,
oppose the budget resolution.
Whitney, can you just mention really quick,
what should groups be doing this week during recess?
How can they convey their opposition to their senators?
- Well first they can make calls, pretty much
from anywhere even if you don't have an office near you.
I know a lot of people are out in rural areas.
You can also if you do have an office close to you,
like Chad said earlier get a group of different people
and go to their office and talk to them
about the tax reform and the tax scam.
You can do protests.
You can talk to Not One Penny and get signs,
all kinds of stuff. - That's exactly right.
Whitney, I'm so glad you jogged my memory.
The Not One Penny Coalition.
Again, the idea here is not one penny in tax cuts.
Not One Penny can send you signs
for when you go out to your members office.
So we're gonna put the link in the comments.
Click on that link, fill out the form, and let us know.
It'll be up for the next 24 hours or so.
Let us know if you want some signs.
We can get them shipped out to you.
These are good looking signs.
- They're nice.
- Not one penny in tax cuts for the rich and corporations.
- Yeah. - This is good stuff.
It's really gonna add to your protest.
- I'm very excited to see all my groups
with the signs this week. - Yeah, absolutely.
All right, so I think we're just about out of time.
So to sum it up, it's not tax reform.
It's the Trump tax scam.
It's about tax cuts for the rich paid for
by exploding the deficit that will force deep cuts
to Medicaid, Medicare, social security down the road.
What can you do?
Share this video so that your friends can see it
and learn about the tax scam as well.
Go to indivisible.org.
Check out our resources there.
Go to trumptaxscam.org
and find our call scripts, explainers.
Check out the map, get your state data
and get ready to call your members of congress.
If you can, go to indivisible.org, chip in a few dollars.
We'd love to continue this work
and we appreciate any support that we can have from you.
Thanks everybody for tuning in
and we'll catch you next week.
- Thank you.
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