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SALT in Their Wounds

Unleash Prosperity Hotline
Issue #263
1) SALT in Their Wounds

You’ve got to love this story from Politico:

“Nearly every Democrat in New York’s House delegation said Tuesday that they won’t back tax hikes to fund President Joe Biden’s infrastructure package without a full repeal of the $10,000 cap on state and local tax deductions.”

Under Trump, SALT deductions were capped at $10,000. Democrats have said for decades that taxes the rich don’t pay their “fair share” of taxes, but now they want to bring back a deduction that almost exclusively benefits millionaires and billionaires in their high-tax blue states. 

Nancy Pelosi grouses that eliminating the deduction is “devastating to California” with its 13% income tax. Or consider New York, which has just raised its income tax to 15% on millionaires. With the SALT deduction, Michael Bloomberg could deduct 40% of those tax payments, meaning he would only pay 9% with the other 6 percentage points effectively paid for by out of staters. Now he has to pay ALL 15%.

Meanwhile, a gang of Dem governors from high tax states – including Andrew Cuomo, Gavin Newsom, J.B. Pritzker, and Ned Lamont – signed a letter begging Biden to bring back SALT to their millionaire and billionaire residents/donors. They pouted that getting rid of the deduction “increases taxes on hardworking families.” Wrong. About 60% of the benefits from the SALT deduction go not to the working class, but blue state millionaires. These are the very rich people who Biden and his pals say should pay MORE taxes.   

What is terrifying the blue state Dems is that losing the SALT deduction is vastly accelerating the stampede of the rich to low-tax states like Florida from high-tax states like New York. Now the same liberals who argued for decades that taxes don’t affect behavior are seeing it in warp speed right before their eyes.

So behind closed doors, the Dems are trying to find a way to bring back a loophole for the super-wealthy without looking like the biggest frauds and hypocrites that ever walked inside the Capitol Dome. 

The chart below shows the states with the highest taxes, including New York, Vermont, Minnesota, New Jersey, Connecticut, and Illinois. 

2) America’s New Progressive Trust-Buster: Republican Josh Hawley

We know some of our readers are fans of Josh Hawley, the young Republican senator from Missouri. But his new bill: “Trust-Busting for the Twenty-First Century Act” is about the most dangerous bill we’ve seen from a Republican in ages. It would reduce American competitiveness, cost millions of jobs, penalize companies for growing and being profitable, kill funding for business small business start-ups, and empower unprecedented new regulatory powers to the Deep State lawyers and bureaucrats in Washington.

By his own acknowledgment, Hawley would put new teeth into antitrust laws that got started during America’s first “Progressive Era.” His bill would: Ban mergers and acquisitions by firms with a market cap over $100 billion
Lower the threshold for prosecution under existing federal antitrust laws, replacing the prevalent “consumer harm” standard with one that emphasizes “the protection of competition”
Require companies that lose federal antitrust lawsuits to “forfeit all their profits resulting from monopolistic conduct”
Give the Federal Trade Commission new power to designate and regulate “dominant digital firms” in different online markets
Sounding much like Bernie Sanders, Hawley told Axios: “This country and this government shouldn’t be run by a few mega-corporations.” The Republican Party “has got to become the party of trust-busting once again.”

That’s like saying we should bring back Smallpox.  

Trust-Busting is a century-old term based on the enduring leftist mythology that America had been taken over by “robber barons.” Our great friend Burt Folsom has exploded these progressive lies in his classic book “The Myth of The Robber Barons,” which shows definitively that J.P. Morgan, Henry Ford, Dupont, Andrew Carnegie, Cornelius Vanderbilt, and John D. Rockefeller were anything BUT villains who raped consumers with their monopolistic behavior and “stockpiles of wealth.” Instead, they were heroes who built the railroads, our modern financial system, the oil and gas industry, and the automotive industry, to name a few. 

Now Hawley is arguing that America’s total dominance in the high tech industries – Apple, Amazon, Google, and the like – “hasn’t been a success for the consumer.”

Really? In our lifetimes the cost of cellphones has fallen by 95%; the cost of the internet has fallen by 98%, the cost of internet transactions has fallen by more than 80%. Globalization has moved more than one billion people out of poverty. How are these companies “gouging” consumers?

All Republicans should reject this assault against our free enterprise system, and if Hawley wants to break up monopolies, his efforts would be much better spent trying to break up the government school monopoly.

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