Waching daily Jan 26 2017

Donald Trump, Republicans plan enormous tax cuts, even though it�s going to balloon

the deficit.

President Donald Trump and his administration, along with congressional Republicans, are

reportedly thinking of implementing massive tax cuts that aren�t revenue neutral � ones

that would cause the deficit to rise dramatically.

�A number of Trump advisers in recent weeks have privately questioned whether tax reform

needs to be �revenue neutral,'� Politico reported on Wednesday, citing people involved

in the early discussions.

What the Trump administration has not yet done, Politico noted, is figure out how to

avoid ballooning the deficit while following through on its campaign promises to increase

military spending, construct a border wall, and finance infrastructure development.

This dilemma, along with the fact that it will be difficult for Republicans to bring

Democrats on board for a tax cut plan that increases the deficit (the one from Trump�s

campaign would cost $10 trillion over a decade), could prove very difficult for the Trump team

to overcome.

House Speaker Paul Ryan is expected to fiercely oppose any tax cut plan that isn�t revenue

neutral.

Trump�s chief of staff Reince Priebus, strategist Steve Bannon and son-in-law Jared Kushner

are all reported to have kept silent when Ryan made that clear to them during a private

meeting.

Republican legislators seem to be split on the question of revenue neutrality.

�I think the government should be smaller, and I�m for tax cuts and spending cuts that

reduce the overall size of the government,� Sen. Rand Paul, R-Kentucky, told Politico

on Tuesday.

�Trump�s [campaign] tax cut was large and not �revenue-neutral.� I support what

Trump ran on.�

This attitude was echoed by former Freedom Caucus Chairman Jim Jordan, R-Ohio, who told

Politico that �I�ve never subscribed to the Washington �revenue-neutral thinking.

It�s like: Put together a tax plan that produces economic growth; don�t let it be

constrained by anything else.�

In order to pass large tax cuts quickly, Republicans have been trying to do so through the process

of budget reconciliation � which they cannot use for programs that will add to the deficit

in the long term.

�That�s always been the plan: You have to be [revenue-neutral], really, for reconciliation,

so there�s really no option other than that,� said Rep. Devin Nunes, R-California, who is

also a Trump transition official.

This attitude was echoed by Rep. Bill Flores, R-Texas, who said that �we should take no

action that increases deficits or that increases the debt.�

Trump�s tax cuts have also been criticized for primarily helping the wealthy while actually

raising taxes on many lower-income individuals, as well as proposing a so-called �skinny

budget� that will cut funding for everything from the arts to protecting women suffering

from domestic violence.