Conservatives, who hold more influence in the GOP, viscerally believe that individuals and businesses are the backbone of America. They govern on the fundamental principle, originating with the founding fathers, that “the government that governs least, governs best.” They point out that the greater involvement Washington has in the economy, the worse things get, and the poorer both citizens and enterprises become. Conservatives emphasize that starting with the Carter Administration and accelerating during the Clinton presidency, federal mandates about lending to those without the standard demonstrated capability to repay eventually caused the Great Recession. They point out that President Obama’s policies devastated the middle class, and prevented America’s GDP from emerging from unprecedented poor growth. They note that restrictions on businesses and high taxes (the United States has the highest corporate taxes of any developed nation) devastate middle class jobs, and encouraged large businesses to leave the country, taking their revenue stream with them.
The GOP tax plan recalls the results of cutting taxes by both Democrat President John Kennedy and Republican Ronald Reagan. Both instances resulted in significantly greater growth in both federal revenue and jobs, and an improved business climate. It is that experience they seek to repeat in the current tax bill.
Republicans argue that by creating greater numbers of jobs and better opportunities for middle-class owned businesses (who, as “pass through” corporations receive better tax cuts), the middle-class benefits from the measure. The standard deduction and personal exemptions are nearly doubled for individual filers, a very significant saving, and the child care credit is increased. Many individual tax rates are slightly reduced, but some deductions, most notably for state and local income taxes, would be lost. Those, of course, are specifics; the general concept that government should not place unnecessary expenses on families or restrictions on businesses is their central point.
Democrats chafe at the notion that corporations could receive a large tax break under an approach that seeks to increase jobs, at the expense of revenue to fund social benefits. They believe that there is revenue-related danger in this approach (despite the experiences of Presidents Kennedy and Reagan) and that Washington will not be able to gather the dollars needed to fund social spending programs, which, except for Social Security and Medicare, expanded during the Obama Administration.In a statement, Senator Bernie Sanders noted:
I am disappointed but not surprised that the Republicans voted unanimously to proceed with a disastrous tax bill. This bill will provide 62 percent of the benefits to the top 1 percent.
Senator Elizabeth Warren tweeted:
Tonight the Senate GOP gave a giant tax break to the rich & left everyone else holding the bag. This is about more than economics—it’s about our values.
The general approach favored by Democrats has been that a Washington-directed economy would produce a more equitable result, and that the overall health of the economy is only a secondary consideration.
Encapsulated in the debate over the tax bill are two very different visions for the United States, with Republicans adhering to a more traditional view of an economy centered around jobs and enterprise, and Democrats preferring a path trending towards a more government-directed environment.
In the past, significantly different views were eventually compromised. But in the all-or-nothing votes, with almost all Republicans voting one way and every Democrat senator voting the other, the nation is revealed to be more sharply divided than at any time since the Civil War.
During the 2016 presidential primary season, Hillary Clinton was asked whom she considered to be “the enemy.” Rather than citing an external source, such as terrorists, or a challenging issue, such as poverty, Ms. Clinton simply replied, “Republicans.” She later doubled down on that concept, claiming that half of those supporting her Republican opponent were a “basket of deplorables … racist, sexist, homophobic, xenophobic, Islamophobic—you name it.”