GUALFIN, ARGENTINA – Team Trump came forward yesterday and laid what it claimed was the “biggest tax cut in history” on the table.
Before we go on, we should say “We love this guy.”
If you’ve been reading the Diary for a while, you know that, thanks to the feds, rich people have gotten much richer over the last 35 years.
Their funny money and artificially low interest rates have boosted Wall Street stocks and bonds far faster than the Main Street economy.
The working-class guy sells his time for barely a penny more (in inflation-adjusted terms) than he did during the Reagan years.
But stock prices, measured by the Dow, are 21 times higher!
And now this…
What other president would have the chutzpah to huddle with Goldman guys and work out a tax proposal designed to make rich people even richer?
Before the French Revolution, the aristocracy paid no taxes; maybe the next thing will be to exempt America’s top 1% altogether.
The latest proposal is a mix of good, bad, ugly, and mysterious… with many parts so vaguely defined that they could mean anything.
But our first thought was: Why is the president proposing tax changes?
He’s supposed to represent the “administration.” That is to say, he’s supposed to administer the laws written by the people’s representatives in Congress.
Specifically, the House of Representatives is charged with “the power of the purse”:
All Bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.
– U.S. Constitution, Article I, Section 7, Clause 1
So why is “The Donald” getting involved?
We have an answer…
As the Deep State grows, it puts so many greasy fingers in so many pots and pies, it becomes impossible for the legislature to keep up with them.
One faction wants a new bridge across the Susquehanna. Another wants to change section 408.7.5 so that the amortization for cherry-picking machines used in Puerto Rico can be accelerated without regard to the “backward capture” rules.
Congressmen, busy dialing for dollars from their local cronies, haven’t time to read the proposals let alone understand them.
Congress is supposed to control the war-making function of government, too. But one group wants to bomb ISIS. Another wants to bomb ISIS enemy Bashar al-Assad.
In the end, power passes to the administration, which bombs them both.
That leaves lawmaking increasingly in the hands of lobbyists, industry insiders, and the White House – which no longer functions on behalf of the people, but merely shifts the balance of larceny toward one group or another.
So it is no surprise that, with so many Goldman representatives in the room, the new tax proposals would favor Big Business and the rich.
Note also that no threat has been proposed to the Deep State’s funding.
Taxes are the bread and butter of the swamp critters’ diet. And the tax code is the way the Deep Staters reward their crony friends and punish their enemies.
It will be a cold day in hell when they give up the revenue or the power to diddle with tax provisions.
But today, we’re thinking positive. Trump is our hero. We look upon his proposals with much pleasure. Four of them, in particular, seem designed for us.
Before we go on, we would like to make a philosophical announcement. In matters of public policy – war, taxes, laws, regulations, and government programs of all sorts – people say that “this would be good” or “that would be bad.”
But none of us really knows what would be good or bad.
First, we can never know what the results and unintended consequences of any public policy will be. We can’t know the future.
Second, even if we knew what would happen, we couldn’t know whether it would be good or bad.
Mr. Trump famously wants to “make America great again.” But there must be 200 million different, and often contradictory, ideas about what that means.
One person thinks the country would be great if the bar on the corner were reopened and once again offered 50-cent beer. Another wants to get rid of the Puerto Ricans who moved next door. Still another longs for the days when banks gave you a free toaster oven when you opened a new account.
One group of Americans thinks the country would be better off if the rich paid “their fair share” of taxes. The rich think they already pay too much.
Nobody knows how to make America great again. All anyone knows is what he wants. The poor vote for more social welfare programs. The rich vote for tax cuts and crony deals.
So when someone says Trump’s tax changes will be “good,” what he really means is “Given the current state of my finances… along with my ideological preferences and fantasies, I like them.”
You can put us solidly, resolutely, and unapologetically in that camp, too.
And for an honest, and selfish, reason: Trump’s proposed tax cuts would save us beaucoup bucks.
His proposal to cut the tax rate on pass-through income alone would cut our tax bill in half. His proposed elimination of the inheritance tax would have an even greater effect on our children.
The president would also cut the regular income tax maximum rate from 39.6% to 35%… eliminate the alternative minimum tax (originally enacted to prevent wealthy Americans using deductions and loopholes from skimping on their taxes)… and repeal the 3.8% net investment income tax.
We don’t know what is best for the country. But we know what we want.
And if you have been lucky enough to start a successful business… and if you have selected a form of business other than a C corporation (taxed separately from its owners)… chances are you have a considerable amount of revenue passing through the corporation and showing up on your personal tax return.
There, it is taxed at the highest rate. What’s left is your estate, which is taxed again when you die.
Mr. Trump, bless his craven little heart, would greatly reduce our tax burden.
We love him.
P.S. Tomorrow, why Mr. Trump’s proposed tax cuts won’t happen.
By Nick Rokke, Editor, The Palm Beach Daily
Editor’s Note: Tonight at 8 p.m. ET, our colleagues at the Palm Beach Research Group are holding a live cryptocurrency Q&A session. So today, we take a look at why bitcoin is the best-performing asset so far this year.
Bitcoin is on a tear again…
On Monday, the U.S. Securities and Exchange Commission (SEC) said it would reconsider a proposal to create a bitcoin exchange-traded fund (ETF).
Last month, the SEC rejected the ETF, which would have given investors an easy way to invest in bitcoin.
The commission’s review of its decision has sent the cryptocurrency higher. At the time of writing, bitcoin is trading above $1,300.
Bitcoin’s rise acts as a tailwind for other cryptocurrencies. So we should see many of them rise as well…
— Nick Rokke
P.S. The real cryptocurrency expert around the office is my colleague Teeka Tiwari. Over the past year, he’s traveled over 30,000 miles and met with high-level cryptocurrency insiders.
And tonight, Teeka is hosting a free cryptocurrency question-and-answer session. You can still submit your questions and register for this free event right here.
How Markets React to Tax Cuts
In the wake of Trump’s tax cut plans, many are predicting stocks will continue to rally. But as history shows us, stock markets aren’t always predictable…
Is Your Retirement Account Underfunded?
Many Americans diligently build their retirement funds over decades. But an alarming amount of retirement accounts are now underfunded. Here’s how to see if your nest egg is in good health.
Why You Need to Care About Bitcoin
Cryptocurrencies like bitcoin continue to surge. Our friend Teeka Tiwari explains the forces driving cryptos higher and shows how investors can get in on this growing market.
Today, readers respond to the recent trouble at Bill’s Argentine ranch. And one reader draws an interesting parallel…
Well Bill, now you know what it feels like to be a Trumpster. Every time you feel like you have gotten everything cleared up about your ranch, the deep state (Argentine government) or swamp critters (locals) decide you are an illegal “outsider” land owner and must be evicted.
Wait until the Argentine media steps in on the side of the indigenous locals. You ain’t seen nothing yet. Like our hero, you’ll be labeled as the worst individual since Genghis Khan. Shucks, they may even try to make you appear as terrible as our Donald.
Welcome to the club.
– K. Dame
Meanwhile, other readers quibble with yesterday’s definition of taxation as modern slavery…
Taxpayers are not quite slaves. They are, however, compelled to devote some percentage of their working life to the support of the “gang” who run government. Compelled by threat of paying a substantial penalty if they refuse. The penalty can range all the way up to losing one’s assets, or even one’s freedom to come and go.
There is another word for that… Extortion.
– C. Burton
Gold stocks hammered as Wall Street roars. Even Caterpillar screaming higher. China looking better. Europe looking better. Looks like Casey, Rickards, and Bonner were wrong as rain.
– P. Vale