KALAMAZOO(WKZO AM/FM) — Congressman Fred Upton told a group of Kalamazoo Businessmen yesterday that it’s really impossible to say what the final tax reform plan will look like.
But the St. Joseph Republican says once it passes, he believes that employers will raise salaries and expand their businesses with the tax cuts they will receive. He believes the economy will boom and the huge deficit created by the legislation will be erased.
Upton met with a group of business leaders hand-picked by Southwest Michigan First for yesterday’s session at Tecniq, in Comstock Township.
It’s a fast growing firm that manufactures LED lighting fixtures for Ambulances, tractor-trailer rigs and other vehicles. They say their growth has been slowed by high taxes, and that they would already be a bigger firm if they had not had to pay the Government so much.
But they say they still have plans to grow in the next few years, moving carefully not to overextend themselves.
The business leaders also complained that they could not find enough employees, one of them suggesting that the resulting cut in social programs that might be required to pay off the deficit created by the cuts might force more into the workforce.
Others at the session complained about immigration policies that have made it difficult to find foreign nationals. They also complained that schools weren’t doing enough to support and promote vocational education.
Upton argued that trillions in corporate capital being held off shore would flow back into the U.S. with a lower tax rate, but at the same time conceding that countries like Ireland had already lowered their tax rates again in anticipation of tax reform here.
Upton told them it’s out of his hands now. It all depends on what the Senate does, and then what comes out of Conference Committee.
One of them pointed out that the package does nothing to address the fact that there aren’t enough people now to fill the openings.
He hopes the final product will be the best of the House and Senate plans, which will turn a lot of capital back over to businesses. He says right now the rules requiring a 60-vote majority in the Senate have been lifted. With the special election in Mid-December in Alabama now in jeopardy, if they can’t get it done before the Christmas recess, it will not happen.
Most economists have said the trickle-down theory applied by the tax reform measure has never worked, and panned the two plans working their way through Congress.
Now the non-partisan Congressional Budget Office says low income and middle class Americans will wind up paying more, not less. They estimate that those making $30,000 or less could lose ground as soon as 2019 and those above that would see the scales shift by 2027.
The CBO also estimates that 13-million will lose their health insurance, and only those making higher salaries will benefit from the tax cuts long term.
The CBO says the country will still be left with a 1.4-trillion dollar deficit in ten years.
Upton says we should expect a lot of late changes as Republican Leaders try to cobble together 51 votes to pass the measure.
Right now they can’t afford to lose a single Republican vote in the upper chamber. A Senate vote could come as soon as Thursday. Both Senators Debbie Stabenow and Gary Peters are on record as firm “no” votes.
Because of the rush to pass something, the GOP majority has not been able to bring the public along, or really mount any kind of effective campaign to sell the measures.
The latest Quinnipiac poll shows that 61% of the public say the plan favors the rich. Only 25% approve of the proposals and 52% oppose them.
