Bernie Sanders wants to convince you his tax plan will save you money. The Tax Foundation disagrees:
“On a static basis, the plan would lead to 10.56 percent lower after-tax income for all taxpayers and 17.91 percent lower after-tax income for the top 1 percent. When accounting for reduced GDP, after-tax incomes of all taxpayers would fall by at least 12.84 percent.
“This decrease in GDP would translate into an 18.6 percent smaller capital stock and 6.0 million fewer full-time equivalent jobs. After accounting for the economic effects of the tax changes, the plan would end up increasing federal tax revenues by $9.8 trillion over the next decade.” – far short of the $16 trillion plan to be initially enacted.
We’ll want to take these numbers with a grain of salt, given the Tax Foundation’s conservative leanings. Any criticism of their methodologies is welcome. Infrastructure spending might stimulate secondary employment more than expected. Cheap college might bring new minds and industry into the economy. There’s room for optimism in campaign season.
But let’s ignore the GDP for a moment and look at how this might go wrong for an average American.
60% of American households have health insurance through an employer. There is no guarantee that any cost savings that companies enjoy from ditching their health plans will be passed on to their current employees. Some unions are already preparing their renegotiation platforms, but the average worker doesn’t have that leverage.
Bernie likes to raise one hand and lower the other to visually demonstrate how the numbers balance out for taxpayers on average, but he ignores realities of the job market and the crunch on individual families; problems with ObamaCare have been similarly downplayed by the left. Although the health care rolls have been greatly expanded, a significant percentage of Americans found themselves in worse financial shape after the exchanges opened.
So a typical worker under the Sanders plan might face changing to a new and potentially lower quality health plan, finding new doctors for everyone in the family, and dealing with differences in medical coverage and availability, all while losing 2%+ (straight tax) to 12%+ (factoring in GDP) of each paycheck.
We still need Hope and Change. We still need universal health care and affordable education and infrastructure.
But let’s not hand-wave the hard parts of what we’re asking of our citizens.
It’s only fair to acknowledge the eggs we have to crack to make the omelettes.
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