Last week, Congress passed a tax package that will cut rates on corporations and the wealthy. “You all just got a lot richer,” President Trump told a table of fellow diners at Mar-a-Lago. In addition to slashing taxes on corporations and the wealthiest income bracket, the new law raises the threshold at which heirs pay taxes on inherited estates from $5.5 million to $11 million. The Tax Policy Center estimates that roughly 11,000 Americans who die this year will leave estates large enough to be taxed. Congress scrambled to cut rates on corporations, the wealthy and 11,000 inheritances before Christmas; meanwhile, the Children’s Health Insurance Program—which covers about 9 million poor children nationwide—remains unfunded.
I mention these statistics because the Republican Party made the tax package its No. 1 legislative priority at a moment when the people it benefits are having, if not their best year ever, then their most successful period in four generations. The Dow is at an all-time high. Corporate profits have reached levels not seen since the 1920s. Wages paid for labor, on the other hand, have stagnated for the last 40 years. The gap between rich and poor is larger than it has been since the Gilded Age and, according to the U.S. Census Bureau, 21 percent of American children live in poverty.
Given these conditions, why did the GOP conclude that the country’s first priority is to make life easier for rich people and corporations? This strategy does not make sense from an economic perspective, given that they were winning already. Neither does it make sense from a political perspective. If you want to win elections, helping 11,000 heirs and heiresses—and a bunch of non-voting corporate entities—while offering a pittance to everyone who works for a living seems like a bad strategy.
It is tempting to argue that our representatives in Congress have been bought off. They have made helping corporations their top priority, not despite the historic success of the wealthy, but because of it. The richer the rich get, the more outsized their influence on government. But I don’t think that’s what’s happening. I think our representatives in Congress have ignored people who work because they themselves are members of the investor class.
Take Montana’s congressional delegation, for example. We have three representatives in Washington: Jon Tester and Steve Daines in the Senate, and Greg Gianforte in the House of Representatives. Of those three, two are multimillionaires. Daines reported a net worth of between $9 million and $32 million in 2014. His former boss Greg Gianforte is the richest member of the U.S. House, with a net worth of around $315 million.
Sen. Tester, by comparison, reported a net worth of $1.6 million in 2014. That makes him about 30 times richer than the median American, who reported a net worth of roughly $45,000 in 2014. But he is the poorest member of Montana’s congressional delegation by a factor of between five and 20, depending on how you figure Daines’ wealth. Tester was also the only member from Montana to vote against the Republican tax bill, which he described as “shitty.”
Gianforte and Daines voted for it. Daines held out for a while, demanding an increase in the tax deduction given to pass-through corporations—entities that pay no corporate income tax but pass their income on to their owners, who then pay taxes at the individual rate. Although Daines described these corporations as “Main Street businesses,” the vast majority of taxable pass-through income is made by partners in large law and accounting firms, entertainers, professional athletes and other high earners.
Like Trump, who left Washington for Christmas and was immediately surrounded by the richest people in America, Daines lives in a world of millionaires. His friends and associates don’t have bosses or fill out timesheets. Unless they work for him, people who work for a living are not a part of his day-to-day life. That goes doubly for Gianforte, who has not worked for a company he didn’t own since 1986. When these people think about what Americans are like, how they suffer and what they need, they do not think of Americans with jobs.
This disconnect explains their votes. It explains why they looked at an economy in which working people are falling behind and decided to give a boost to the heirs and investors who are pulling ahead. Gianforte and Daines are too rich to understand this country.
If that sounds like class war, it’s because it is. The multimillionaires of the United States are making war on those of us who work to survive, and they are winning. They are too rich to care about 99 percent of Americans—not intellectually, but viscerally, in their guts—and they will govern us accordingly until something terrible happens. Maybe it will happen to them. At this rate, though, it will happen to us first.
Dan Brooks writes about politics, culture and the utter supremacy of the rich at comatblog.net.