The Broad Support for Taxing the Wealthy

The Broad Support for Taxing the Wealthy

Why Democrats should run on rolling back the tax cut and raising taxes on the rich

June 20, 2018


This article appears in the Summer 2018 issue of The American Prospect magazine. Subscribe here

The 2018 elections in November could be as important to Democrats as the anti-Obamacare 2010 wave election that shaped American politics for almost a decade was to Republicans—if Democrats don’t let ’em hide from their tax scam for the rich.

And we do not yet know whether Democrats will get it right.

As Democrats allowed issues of health care, Medicare, Medicaid, and the tax cuts to move to the sidelines, the national generic vote has narrowed and Trump’s approval rating has crept up. Democrats have deferred to the Republicans on the economy, even though it remains the simplest, most important determinant of the off-year congressional vote, and even though the Democratic base and swing voters are deeply suspicious of what Trump and the congressional Republicans are doing passing a tax cut for the rich.

Am I really recommending that we run in 2018 on raisingtaxes? Yes. We will raise taxes on the rich. Count on it. Voters view that as the most important thing we can do to reverse the Republicans’ corrupt course. Three-quarters of voters want to reverse the tax cuts or raise taxes on the rich to invest in or help the middle class, according to a June survey.

And critically, a candidate who makes this statement—“I want to be very clear: Their huge tax giveaway is wrong and I will vote to put back higher taxes on the richest so we can invest in education and make health care more affordable”—increases opposition to the tax cut and pushes up the Democratic vote and engagement.

Does anybody remember that Bill Clinton and Barack Obama ran their elections and re-elections promising to raise taxes on the rich?

The Trump and GOP tax scam for the rich is the Obamacare of 2018. They packed into this one piece of legislation their hatred of Obama, of the country’s rapidly accelerating diversity, and of the government takeover of health care that benefited millions of those they see as newly dependent minorities.

For the base of progressive voters and for most swing voters, conversely, the 2017 Republican Tax Act is the ugliest and most deceptive face of trickle-down yet, a corrupt deal that will do nothing for working people who face rising costs. It threatens Social Security, Medicare, Medicaid, education, and health-care investments.

It also puts the spotlight on wages and pay gains, and that is the biggest political gift of all. Democracy Corps’ surveys for the American Federation of Teachers (AFT),Women’s Voices Women Vote Action Fund (WVWVAF), and The American Prospect make so clear what should have been obvious. People are still living in the real economy that leaves them struggling. That economy is still defined by stagnant wages and people holding down jobs that don’t pay enough to cover the costs of health care, child care, housing, and education.

If we fail to focus on the tax cut, the Republicans get to talk unchallenged about their tax cut reforms and a growing economy that is benefiting the middle class.

What a scandal that would be, when our voters know the tax cut is a scam, are deeply suspicious of the damage it will cause, and think it is an inside deal for the rich and big corporations that will jeopardize our ability to invest in education and protect our retirement.

The tax cut presents us with a vehicle for defining President Trump and the Republican Congress. What voters now believe is that the Republicans divided the country to get power and that their corrupt deal has allowed the rich to gorge themselves, creating reckless and unsustainable deficits that will come back to kill the middle class.

That is why just as many Democrats and tax-cut opponents say the tax cut will be a voting issue for them as Republicans and proponents do. When college graduates and African Americans in focus groups are given a dry factsheet on the tax cut, they respond emotionally and intensely. At the end of the survey we’ve put before them, the Rising American Electorate of African Americans, Hispanics, unmarried women, and millennials become much more engaged and intent on voting.

That is why the Tax Act has the potential to be the Democrats’ Obamacare. Defining and fighting the tax cut enables Democrats to fight everything Trump and the GOP are trying to do. The more voters hear about it, the more it is debated, and the more they consolidate behind Democrats—key to an off-year victory.

Putting the tax cut at the center of the Democrats’ message platform clarifies what’s at stake in this election—unless that is obscured by Democrats’ caution and cowardice on tax increases for the rich or by their inability to see how much working people continue to struggle in the real economy and how suspicious they are of this corrupt political deal. It allows Democrats to demand change, to decry insider political deals for the richest and corporations, to demand more affordable health care, and to protect the programs people desperately need.

That is why Democrats cannot allow the politicians in Washington to hide from their tax scam for the rich.

The Real Economy

Republicans are depending on the macroeconomy breaking through to dominate voters’ consciousness—but that smashes immediately into the real economy, where nothing has really changed. President Obama tried to get credit for an improving economy and job and wage gains, but Trump—not Hillary Clinton—is president. Now, Trump is playing the same card, and Democrats should know better.

Only 40 percent of voters say that “the economy is strong and families like mine are beginning to be more financially secure,” according to a recent national survey conducted by Democracy Corps and AFT. A majority say it is not strong, and most say so with intensity, because their “salaries and incomes can’t keep up with the cost of living.”

Importantly, they are very aware the macroeconomy is growing faster (62 percent agree) and that there are more jobs available. In focus groups, they told us the economy is better than what it was and is improving because “unemployment is down, people are working, people aren’t losing the house or anything like that.”

Those perceptions are banked, and more reporting of the strong economy does not change their own perception of a lower-wage economy and fewer pay increases that painfully can’t keep up with costs. Nine out of ten voters say “health-care costs are out of control,” and 73 percent agree with that strongly. Most important, 64 percent say their “wages aren’t keeping up with the rising cost of living”—43 percent strongly. That must be the heart of Democrats’ economic analysis and context for the tax cut debate.

People, and especially those who provide Democrats their off-year votes, are genuinely struggling in this economy. According to Democracy Corps’ recent 12-state battleground survey on behalf of WVWVAF, nearly two-thirds of African Americans and unmarried women and more than half of millennials say, “The economy isn’t very strong for families like mine because our salaries and incomes can’t keep up with the cost of living.”

Fewer than one-quarter of African Americans, Hispanics, and unmarried women report seeing any benefits from the macroeconomy’s progress; only one-third of white working-class women and suburban voters report any personal benefit. But that is not what matters. What matters is the Republicans passed a huge tax cut for corporations and the rich that the middle class will pay for, and they did nothing about people struggling with rising costs, especially unaffordable health care.

And it is the economy, stupid! In our regression models that test the impact of party competence in different issue areas, the economy was stronger than any other issue, just above health care, in predicting changes in the 2018 congressional vote. So, getting heard on the economy is a prerequisite for driving up the Democratic vote.

In one scenario that plays well for Republicans, they campaign by heralding the tax cut, wage gains for working people, and the Trump economy to raise GOP enthusiasm, while Democrats talk about other things. In the other scenario, Democrats express anger that Republicans trumpet wage gains as health-care costs spike, and anger about a corrupt and expensive tax cut that will lead the GOP to cut Social Security, Medicare, and Medicaid. That’s the one that works for the Democrats.

The Tax Cut: “It Sounds Good.”

When Republicans describe their tax cut with all their rhetoric on how it will help the economy and middle class and how it raised deductibles and the child tax credit, it is met with a lot of skepticism and ambivalence.

People suspect there are cards in a hand kept out of sight and that in the end, the rich will be the big winners and the middle class will pay the price. Just listen to this exchange among the African American women whom AFT and Democracy Corps interviewed in Detroit after hearing the president sell his tax cut in the State of the Union:

It sounds good, but we don’t think it’s going to happen.

There’s more to it.

I’m thankful for it but I know I’m going to pay for it later.

Let’s wait and see if you get a refund. Because somehow or another you’re going to pay for it.

Even when it comes to Trump voters, the tax cut is no call to arms. Trump voters are constantly looking for evidence that they cast the right vote, yet the tax cut barely came up when talking about good things about Trump. For them, issues like immigration are much bigger and more defining.

The white working-class Obama-Trump voters Democracy Corps and AFT spoke to in Macomb County, Michigan, say that they don’t want to “look a gift horse in the mouth because it’s still savings” regarding the Tax Act, but they insist on “not mak[ing] it more than it is” (white working-class older woman, Macomb). They “expect a lot more” (white working-class man, Macomb), and they began looking for the bad news:

I think just like with anything else, there’s always pros and cons to every single bill or tax break or—there’s always the good with the bad. So you have to figure out what’s real good and what’s real bad. (White working-class older woman, Macomb)

I’m a little skeptical. … How is that going to pan out? If you’re getting more money in your paycheck, you’re paying less in taxes. Is it going to even itself out by standardized deduction? And then, how are people going to be able to itemize? (White working-class older woman, Macomb)

Those initial reactions in focus groups hint at a deeper suspicion that will animate a powerful critique of Trump and Republicans.

Just the Facts

In focus groups, you watch respondents of all persuasions devouring the facts about the tax cut proposal.

Voters do not start the conversation about the tax cut with passionate views, but they end up in a very different place when presented with just a little information. As Democracy Corps, the AFT, and the Prospect found in focus groups, simply introducing a list of negative facts produced a powerful reaction among African Americans, college graduates, and younger white working-class women. Many requested to take their copy home so they could use it to inform their neighbors and organize against the new law, and many wrote post–focus group postcards to Trump to challenge him about the tax cut. In the hyper-polarized political environment Trump has created, this new information becomes fuel for the resistance.

This is such a significant message opportunity because the facts are simple and form the heart of the main attack on the tax cut. The facts are a nearly $2 trillion increase to the deficit that has now made cutting Medicare, Medicaid, and Social Security more likely under Republican rule.  

These Democracy Corps-AFT survey findings make clear that people want to prioritize investment in education, health care, and infrastructure over expensive tax cuts that primarily benefit the rich. That’s also confirmed by the massive public support for the teacher walkouts happening across the country and in states where voters have paid the price for cuts to investments, particularly in education.

Fully 65 percent say they are more likely to vote for the Democrat who emphasizes the $2.2 trillion price tag for a law that gives 83 percent of its cuts to the top 1 percent—meaning less money for education, infrastructure, and help with health-care costs. That includes nearly 40 percent who say they are much more likely to support the Democrat who says this. Nearly as many, 58 percent, react positively to an attack that characterizes the new law as a time bomb for the middle class. The two attacks:

Prioritize investment: The tax law costs $2.2 trillion over the next decade, which means even less funding for investments the middle class needs for a better future. Instead of a law that gives 83 percent of the cuts to the top 1 percent, that money should be used to invest in our public schools and infrastructure and bring down health-care costs.

This expensive tax cut that primarily benefits the top 1 percent adds trillions to the deficit and will be a time bomb for the middle class. It means Republicans will slash Social Security, Medicare and Medicaid to pay for it, and will mean less money for the things we need, like investment in education and help with health-care costs.

The tax cut’s ugly choices and consequences have set up a litmus test for GOP candidates. According to Democratic base and swing voters (the Rising American Electorate and white working-class women) surveyed by Democracy Corps for WVWVAF, the most damaging positions that Republican candidates could take are listed below:

Supports cuts to Medicare and Social Security to address the budget deficit (55 percent strongly oppose)

Opposes universal background checks and an assault weapon ban (52 percent)

Supports the attempts to cut Medicaid, raise premiums, and eliminate ACA protections for pre-existing conditions (48 percent)

These attacks were voting issues, and much more impactful than a candidate’s position on the Dreamers, the special counsel’s Russia investigation, or Trump’s policies that discriminate against minorities.

Short-Term Binge for the Rich that the Middle Class Will Pay For

Across the different focus groups of both Trump and Clinton voters, almost no one contested any of the “facts” in the factsheet, or that Republican leaders now plan to put entitlements and critical investments on the chopping block.

They begin to wonder, where is the snake in the grass? They know how much they may receive if they are lucky—a few thousand dollars, according to the Republicans—and that doesn’t square with the massive price tag and deficit increase.

I think that the difference is going to have to be made up at some point and it’s going to come from the middle class, not from the .1 or .01 percent that just are retaining billions. We’re getting $250. We’re going to pay back those trillions. (White college-educated woman, Southfield, Michigan)

The big deficit increase is a powerful symbol that something is wrong with this tax cut: If it is not paid, then it is stealing from their future and from their urgent needs today, like assistance with health-care costs and better schools.

If they did cut [Medicare and Social Security], I think I would have to sue them because I paid into that. That’s my money. (White working-class younger woman, Macomb)

There’s just a lot of negative things in it. Like to hear about them making cuts to Medicare, Medicaid, and Social Security, when the people who already receive those benefits are already struggling as it is. Especially our seniors. (White working-class older woman, Macomb)

So we’re talking about poor people who cannot afford health care to not be able to receive free health care, that’s even scarier. (African American woman, Detroit)

How can you take away money from public schools, while hiring Betsy DeVos who wants to privatize our education system? How can you lie about taking away Medicare, Medicaid, and Social Security? (White college-educated woman, Southfield)

I mean, [Trump] could give you like two or three thousand [dollars a year], but when we’re paying twelve thousand a year for insurance, the two or three is nothing. It doesn’t mean anything. It just doesn’t make any difference to me. Unless you’re going to put something into health care for me, I don’t care. (White college-educated woman, Southfield)

They are especially upset that a tax break goes to those same companies that are increasing costs. “I don’t think the pharmaceutical companies need tax breaks,” said one African American woman. “You make enough money. … So you’re really just robbing us for no reason, just for fun; it’s like a sick game or something.”

They start to see their tax savings as “a façade” to “make it seem like [Republicans did] something good” to cover up the fact that the rich and powerful are “getting billions and billions,” and that in the end, “they’re really gonna screw you a little bit more,” says one African American women in Detroit.

In short, the tax cut defines what people hate about Trump and Republicans and their vision.

Branded: Tax scam for the rich

At the end of a national message survey conducted by Democracy Corps and AFT, those opposed to the Tax Act called it “garbage” and a “bad deal” or a “scam” “for the rich” in their open-ended responses. When we gave them choices based on what we learned in the focus groups, they went strongly to rigged for the rich, followed by time bomb for the middle class

It is easy to imagine Democrat messaging evolving to rigged for the rich.

New Message Platform for 2018

Throughout the years that Democracy Corps has been testing election messages for WVWVAF, we have been recommending some bolder version of a message evolved from our work with the Roosevelt Institute: a message that says Democrats are “fed up” with the rigged political and economic system, and want to rewrite the rules.

But after Trump’s attempts to divide the country, repeal the Affordable Care Act, and destroy Medicaid, as well as this brazen tax cut for corporations and billionaire supporters, the message we recommend has become bolder still. Americans now see the politicians trying to steal as much as possible for the wealthy, while the future is sacrificed. That new focus proves strongest for all groups that are key to winning in November.

The aversion to short-term political deals and short-sighted cuts is an opening for a more developed message that drives Democrats in 2018.


The Electoral Impact of Battling the Tax Scam for the Rich with a New Message Platform

After a balanced tax cut debate, as simulated in the recent Democracy Corps-AFT national phone survey, the opposition margin grows 9 points nationally and grows 7 points in the battleground districts. Intense opposition to the tax cut grows 7 points among Democrats, but more importantly, GOP opposition to the cuts grows as well. Support collapses with unmarried women, white working-class women, and seniors.

Critically, interest in the 2018 midterm elections among Democrats grows 4 points after hearing a tax debate, increasing their enthusiasm margin over Republicans from 7 points to 11 points.

The new message about the tax cut is a game-changer for Democrats. In WVWVAF’s web survey in 12 battleground states with key gubernatorial and Senate races, we see a big increase in the number of Democratic base voters choosing the highest point on our turnout ladder after having heard a debate featuring this message. That matters because Democrats are winning African Americans by a nearly 10-to-1 ratio, and Hispanics, millennial women, and unmarried women by 2 to 1.

It is these kinds of shifts in engagement that can turn 2018 into a 2010-type wave, but it requires embracing the attack on the tax scam for the rich as Republicans did the repeal of Obamacare. That is the opportunity we have—if we don’t let them hide.

The Washington politicians are dividing the country and using their government takeover to enrich their rich friends—political deals that will blow up on the middle class. Their huge tax cuts for big corporations are a tax scam for the richest, while hardworking people struggle to pay the bills and skyrocketing health-care costs. They are recklessly driving up the deficit and using that excuse to cut Social Security, Medicare, and Medicaid, and to block investments in education, infrastructure, and health care.

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