Republican Tax Plan

[TheDrake]

TheDrake, and what do you mean by "savings"?  Walk me through it, how are they going to be passed on to another generation?  In mattresses?  Boxes of gold?   How do these savings survive the next 10, 20, 40 years until they are passed on?  Do you think, maybe, that those who recieve them may use them like they do now?  You know, with the majority going into new investments that generate return?

Deficits concern everyone (though not mentioned when the Dems want to spend more), the entire argument though is that its a false claim.  There's almost no uncertainty that the corporate tax cuts are going to result in a non-zero amount of new investment and a non-zero amount of real wage increases.

0.1% is a non-zero amount, size matters.

An investment that generates return is not necessarily capital investment that generates jobs.

Apple buys back its stock, and money goes to people who were holding that stock. They use that money to buy other stocks. Unless it gets to a company performing an IPO or raising debts through bonds, its just savings generating investment return but not jobs. Typically this would manifest as high P/E ratios. This is a very real scenario, but just like your example, size matters. I don't have a great concept of how much this might happen, but it is a concern. This is especially likely for companies (like Apple) that already had plenty of cash and cash equivalents and have chosen not to use it for organic growth or greenfield expansion (or increased wages, for that matter).

There are a non-zero amount of companies that will pocket the cash, increase executive compensation, and other reactions that will not generally improve economic conditions for the majority of Americans.

Luckily, we'll be able to measure this impact on publicly traded entities. Capital investment is easily identified vs cash and cash equivalent. You may be fully right, or you might even be underestimating the even better outcome we're going to enjoy. I'm only trying to say that there is room for a reasonable person to be skeptical.

[DonaldD]

Move the goal posts much, Seriati?  Who said it was proof - it is an example of CEOs saying exactly what you were asking about "any one in management of a major company they have been saying the same thing"

But the point is not whether there will be zero hiring or salary increases as a result of tax decreases - of course, there will be.  It just won't be significant.

Here are some more examples of what you were asking for:

Robert Bradway, chief executive of Amgen Inc., said in an Oct. 25 earnings call that the company has been “actively returning capital in the form of growing dividend and buyback and I’d expect us to continue that.” Executives including Coca-Cola CEO James Quincey, Pfizer Chief Financial Officer Frank D’Amelio and Cisco CFO Kelly Kramer have recently made similar statements.

“We’ll be able to get much more aggressive on the share buyback” after a tax cut, Kramer said in a Nov. 16 interview.

[Seriati]

Move the goal posts much, Seriati?  Who said it was proof - it is an example of CEOs saying exactly what you were asking about "any one in management of a major company they have been saying the same thing"

My problem with it is that it's an anecdote.  It's a single event with a single story that has been repeated for weeks, notwithstanding that anyone with real knowledge could tell you its not the case.  I suspect that the sole reason it's really out there is for the purpose you've put it too.  It's a convenient citation to "settle" the point, nothing more.  Do some actual research and come back to me. 

The point is nonsense.  The only reality that is working against the tax cuts having the impact I laid out is uncertainty.  Specifically uncertainty about whether corporate America can trust the tax cuts to stay in place and apply long term.  Go read on this point, and you'll find tons of confirmation.

I feel like I'm arguing with know nothings on this point.

But the point is not whether there will be zero hiring or salary increases as a result of tax decreases - of course, there will be.  It just won't be significant.

Perfect.  Thanks for committing, we can check in see at end of next year.

Here are some more examples of what you were asking for:

Robert Bradway, chief executive of Amgen Inc., said in an Oct. 25 earnings call that the company has been “actively returning capital in the form of growing dividend and buyback and I’d expect us to continue that.” Executives including Coca-Cola CEO James Quincey, Pfizer Chief Financial Officer Frank D’Amelio and Cisco CFO Kelly Kramer have recently made similar statements.

“We’ll be able to get much more aggressive on the share buyback” after a tax cut, Kramer said in a Nov. 16 interview.

That will certainly occur as well.  Some companies have no better use for cash than to return it.  That's actually a good thing, as people who are invested in one company will be looking for new investments when the cash is returned.  Freeing up equity is great.

You can also go out and read about companies that are carrying excessive debt who are less happy than other companies (while some of these were legit, a bunch of them got into these positions expressly as a tax avoidance strategy).  They'll be looking for equity as well, which while a bit of a replacement (debt with equity) will also provide some benefit, and free up leverage in the system to seek out better uses.

[Fenring]

Perfect.  Thanks for committing, we can check in see at end of next year.

I'll lay down my own commitment to the prediction that no matter what the economic results are it won't be possible in a thread here to establish what the actual facts are, to say nothing of us agreeing that someone was 'right' or 'wrong' about it 

[yossarian22c]

How about at least a baseline definition of what success is for the tax cuts economically. The economy has grown at 2+% since the recession and unemployment has trended steadily downward. So for the tax plan to be a success economically we should see 2+ years of 3+% gdp growth, a continued decline in unemployment, and significant (2% greater than inflation) wage growth (for non executives).

A second metric for success would be for the government to continue to have sufficient revenue to provide services and invest in infrastructure. If the next policy priority for republicans is to tell us we have to cut services and entitlements for the poor then the poor and lower middle class will end up losing big from the tax cut bill.

[TheDrake]

Baseline success, a rise in median income adjusted for inflation. Largely flat over the past 15 years.

This group makes $50 per year, roughly, so we're not talking unskilled workers. This is the group that is supposed to get all the benefits of growth, including higher wages and better jobs.

Move that needle, and I'm on board. If gdp grows a bunch and median income doesn't rise - well we know who got all the benefit then, don't we?

The second question would be - when do we measure? It takes time to react to new policy, etc. Are we really going to see meaningful improvement at the employment level by then? I still wonder how much of the Clinton boom years were really long-term effects of Reagan and Bush policies. If you leave it loose, then you just cherry pick the good or bad year.

This still leaves the potential impact of major events to obfuscate any effects. What happens if NK becomes a shooting war? It pretty much obliterates any ability to separate impacts. Did the tax break make it "less bad" than it would have been?

[TheDrake]

Man, CNN continues to lower my already low opinion. Top three headlines on the tax change:

Homeowners scramble to pre-pay property taxes
Residents in high-tax states could lose thousands of dollars due to new tax rules starting in 2018
Apple finally got its tax break. Will billions of jobs follow?

WTF?

The first two are just deeply skewed, but the last one borders on illucid.

So yeah, if this is your sole go-to news source I can absolutely see why you'd have an uninformed negative opinion no matter how methodical the process might have been.

[DonaldD]

Without getting into the accuracy of your characterization, the "billions of jobs" bit is a headline typo - in the headline and lead statement within the article itself, it is clear that the "billions" refers to dollars, not jobs.

It doesn't mean that CNN is not biased, I'm simply pointing out that sometimes, people are just stupid, not evil.

[Seriati]

The CNN article on Apple is pretty funny.  Somehow they think it's a good "test" case to pick a tech company that has the largest cash hoard on the planet.  It's pretty clear that if they could invest the cash in any reasonable profit generating endeavor they already would have.  Microsoft was the same way for the longest time.  Tech companies number one assets are highly skilled employees.  And sure they may use the money to try to raid each others' top end staff.

But it's almost certainly a fact that the best use of Apple's money (when they don't actually need anything) is to return to their owners, who themselves can reinvest it in other ventures.  It's either that or a return to the era pre-80's where company's empire built and acquired completed unrelated ventures. 

Who exactly would Apple create jobs for?  Are they going to hire farm hands?  Or build cars?  Rationale analysis is informed by the object of the study.

The pre-payment of taxes idea probably impacts less than the breathless reporters imply.  Many many people in High Tax states who make enough to get a benefit from pre-paying SALT will actually get no benefit from doing so because their SALT deductions were already high enough to force them to pay the AMT and anymore SALT is therefore already a complete waste.

[TheDrake]

The pre-payment of taxes idea probably impacts less than the breathless reporters imply.  Many many people in High Tax states who make enough to get a benefit from pre-paying SALT will actually get no benefit from doing so because their SALT deductions were already high enough to force them to pay the AMT and anymore SALT is therefore already a complete waste.

It isn't even clear if you can deduct pre-paid SALT. This is all speculative, and you wanna bet the IRS ruling is that you can't? This is going to screw up people's escrow handling and cause a big headache for no return. I will also predict that rather than saving the prepaid taxes, at least some of these local governments will squander it and then choke on it a year later. They're really just not wired for having wads of extra cash on hand.

[Greg Davidson]

This is a decent-sized economic stimulus - there should be a relative increase in the rate of growth up to half a percent above the average for the past two years, particularly for the next 1-1.5 years (in subsequent years the size of the stimulus to most Americans begins its decline).  That's what happens when you insert an extra $1-2T of stimulus into the economy (over many years). Of course, the relative value of economic stimulus is at its lowest when unemployment is relatively low. Put differently, this is the most wasteful way to use economic stimulus (ie; least return in growth given the increase in debt).  But it probably will help the economy through the 2018 midterm elections.

[Seriati]

It isn't even clear if you can deduct pre-paid SALT. This is all speculative, and you wanna bet the IRS ruling is that you can't?

It's actually fairly clear, the IRS has guidance on it.  You can only deduct that portion of the pre-paid tax which has been assessed.  It's too late to make a difference now, but alot of people rushed down to pay unassessed taxes which are not deductible.  A number of my neighbors rushed in to pay their taxes then found out that it's a waste of time if you paid the AMT cause they only read the headlines and the panic posts.

This is a decent-sized economic stimulus - there should be a relative increase in the rate of growth up to half a percent above the average for the past two years, particularly for the next 1-1.5 years (in subsequent years the size of the stimulus to most Americans begins its decline).  That's what happens when you insert an extra $1-2T of stimulus into the economy (over many years). Of course, the relative value of economic stimulus is at its lowest when unemployment is relatively low. Put differently, this is the most wasteful way to use economic stimulus (ie; least return in growth given the increase in debt).  But it probably will help the economy through the 2018 midterm elections.

Lol.  Talk about looking for a bad side.  Employment is not the only relevant factor in evaluating the impact of a stimulus.  The vast majority of Americans live pay check to pay check, tax relief that puts money in their hands can have a big impact even in times of high employment.  In fact that can be the best way to increase spending.

Putting capital in the hands of investors is also the best way to generate investment in new businesses and expansions. 

[TheDrake]

Putting capital in the hands of investors is also the best way to generate investment in new businesses and expansions.

Or fuel speculation on Bitcoin.

[Seriati]

In fairness that could certainly be one result.  Of course that'll provide a massive influx for initial coin offerings.

[Greg Davidson]

The vast majority of Americans live pay check to pay check, tax relief that puts money in their hands can have a big impact even in times of high employment.  In fact that can be the best way to increase spending.

Putting capital in the hands of investors is also the best way to generate investment in new businesses and expansions.

With regard to your first point, I agree but then why is that relevant to this tax cut which probably puts a much greater share of the cuts to the rich?

With regard to your second point, you have quoted a principle of faith among the right wing but I am certain that you cannot show comprehensive evidence that tax cuts lead to higher investment in new businesses and expansions (because the historical record for at least the past 30-40 years does not support that hypothesis).

[Seriati]

The vast majority of Americans live pay check to pay check, tax relief that puts money in their hands can have a big impact even in times of high employment.  In fact that can be the best way to increase spending.

Putting capital in the hands of investors is also the best way to generate investment in new businesses and expansions.

With regard to your first point, I agree but then why is that relevant to this tax cut which probably puts a much greater share of the cuts to the rich?

Because this tax cut specifically is a tax cut for the majority of Americans.  Focus on the rich is just a liberal bogey man.  The majority of people in this country are going to have more money in their pockets as a result of this cut.

It will also generate new investments, as a result of your loathed tax cuts on the rich, which themselves will generate better paying opportunities for others.  In an era of underemployment, that too is a welcome consequence.

With regard to your second point, you have quoted a principle of faith among the right wing but I am certain that you cannot show comprehensive evidence that tax cuts lead to higher investment in new businesses and expansions (because the historical record for at least the past 30-40 years does not support that hypothesis).

If you say so.  Of course, the rest of the world is so convinced that that they are considering slashing rates themselves, filing complaints with the WTO (as they view this as an unfair trade practice to encourage capital to invest in the US) or even entering into attempts to freeze capital in their own countries to prevent it from being reinvested in the US.  Here's a link the ultra ultra ultra conservative NYT (sarcasm off) that shows some of this initial response and talk.  https://www.nytimes.com/2017/12/22/business/tax-bill-global-profits.html

Maybe you are correct, but no one in the world (other than Democratic politicians) seems to believe that you are correct.

As to whether it could be showed?  Almost all the most current and interesting research is showing that tax cuts to corporations lead to reinvestment and better wages (granted they have other impacts as well).  And we've seen deliberate anti-investment tax restructuring as a direct response to the previous tax system, which is direct evidence how smart people with money view the competitiveness.

Is it possible to tank the gains?  Sure.  Bernie's already started trying with a promise to raise corporate taxes when he can.  The Dems may be able to create enough uncertainty to prevent companies from trusting there has been a long term change.  Some blue state governors may try to do what they did last time there was a federal tax cut and "capture" the tax savings for themselves - though killing SALT makes that so much more obvious this time than it was last time.

[Seriati]

This one really is from a conservative group, but it's clips and reviews of pieces from around the world.  Again demonstrating that other countries are taking the impact seriously (and treating it as a settled fact).  http://www.nationalreview.com/article/454958/gop-tax-cuts-forcing-other-countries-compete

[TheDrake]

There are two questions - will it lead to reinvestment, more high end jobs, more GDP? Absolutely. No question, which is why as Seriati states, other countries are going to try to combat the US advantage (or improvement).

The other question is, will anyone below the median income see higher wages, more jobs that they are _qualified_ for? A lot less certain. More capital could easily mean more automation, more outsourcing, and increases in executive compensation. All of which can be called a better economy - but for whom?

Decreased corporate tax isn't going to help the person who wants to start a food truck business, open a restaurant, or haul freight independently. In fact, it makes it less viable as a restaurant group opens another location, etc.

In my opinion, the overwhelming gains go to people with brokerage accounts (less than half of all Americans have them), college educated or self taught people with skills in high demand (much less than half), and perhaps self-employed professionals.

Depending on your philosophy and politics, that could be a good thing or a bad thing. But I don't think we should kid ourselves that this is some kind of universal boon for everyone. The last time everybody won was when Oprah was on TV. You can make an argument, certainly, that no one is worse off than they were before - until we start looking at programs like CHIP that are under fire for being too expensive, especially now with higher deficits.

[rightleft22]

It's the deregulation that will undo any benefit from the tax changes - it will just be a bigger fall

[Seriati]

You're going to have to explain that one.  It's widely acknowledged that the Obama administration's regulations added a large amount of cost to doing business, and it's generally acknowledged in the business community that efforts to lift that regulatory burden will spark growth.  Do you have some reason to believe that contrary to most commentators and virtually all evidence the reverse will be true?

[TheDrake]

Of course deregulation spurs growth. Just picking one example, worker safety standards, could also result in increased costs for health care, workers compensation claims, and other costs related to injured workers. These are not able to be measured in an appreciable way, so its hard to prove empirically what the effect was.

Just one of those quickly googled at random - lowering the limit for silica exposure, resulted in industry complaining that it was too hard to measure and comply. I'm sure if you eliminated OSHA altogether, you'd create a giant surge in business profit at the expense of injuries and long term health issues.

Policy isn't always about creating the greatest growth imaginable. When shady operators skirt safety issues - where is the check and balance? Unions often pushed for such things in a previous era, but it has been fairly clear that business does not handle this on their own. So, you wind up with an anarcho-capitalist view that says "well, it was up to the worker. They can always not work there." Assuming that they even knew what risks were in place. I'm kind of okay with safety rules, but it is obviously possible to swing too far and make it impossible to do business.

I'm sure if I took everything line-by-line, I'd agree with some regulations and not think others were warranted.

[Seriati]

Again, we live in an era of crazy levels of over-regulation.  If you missed, here's great recent write up from the NYT's of just one place https://www.nytimes.com/2017/12/27/business/picking-apples-on-a-farm-with-5000-rules-watch-out-for-the-ladders.html.

It's very easy to see how meaning well leads to a ridiculous burden.  Open a small business and come back and tell me you think we have the correct amount of regulations.

[TheDrake]

That's a good article, and it does lay some things out worth discussing. But those ladder rules didn't come up because nobody was falling off of them. You'd like to say, "isn't this just common sense, what a waste!". Until somebody doesn't train their workers on the correct way to set a ladder, or how high to climb safely, or other such regulations. I'd like to see that come out in suits against the small business owners, but the owners will say "there is no standard for this training, therefore how could we fail to meet it?" They rightly would point out that accidents do happen and too bad about that, but at what point are employers negligent?

Food safety regulations have been cited as stopping people from donating prepared food. But what are you going to do when somebody changes the baby and doesn't wash their hands before going back to the kitchen? They're going to get a lot of people sick. The worst losers are the people who already know what to do safely, but then suddenly have to prove that they do because of regulation.

Even from the article, note that on top of the government, large customers are asking for more compliance documentation, not less than the government. Why would that be? Because they have a big reputation to lose if there is a supplier skirting safety or labor regulations.

I'd rather a blanket assertion, "Ensure that adequate safety is in place" and then fine the employer for any workplace injury - regardless of cause. If you hired them, you own their decisions and their actions and take the burden of their risk. That would dump the red tape, but leave incentives to keep people safe.

[Greg Davidson]

There are two questions - will it lead to reinvestment, more high end jobs, more GDP? Absolutely. No question, which is why as Seriati states, other countries are going to try to combat the US advantage (or improvement).

It's widely acknowledged that the Obama administration's regulations added a large amount of cost to doing business, and it's generally acknowledged in the business community that efforts to lift that regulatory burden will spark growth.  Do you have some reason to believe that contrary to most commentators and virtually all evidence the reverse will be true?

These are faith-based assertions - if you are a conservative, you are ideologically bound to accept them as a matter of faith (and Austrian economics uses a complicated word to make that very claim - there are some things you have to take on faith).

While it is possible that tax cuts and deregulation can increase growth, the track record of the US economy over the last 30 years is that rates of economic growth have gotten worse when taxes on the wealthy have been cut and industry has been deregulated (that is, under Republicans) and has improved when steps in the other direction have been taken (under Democrats). 


Your assertion that your faith-based creed is fact because "most commentators and virtually all evidence" agrees with you merely indicate that you live in a comfortable bubble

[Fenring]

I think that if an alien were to observe this economic debate it would have to conclude that either (a) one of these two sides (or both) are insane to believe something so wrong, or (b) that both sides are missing something. I have a hard time believing that one entire side of the argument is insane or stupid because frankly I see a lot of logic in the position of the so-called Austrian school of economics. And yet I also know they're wrong in practice despite the fact that I find the arguments very compelling. Emotionally I agree with the sentiments expressed by Murray Rothbard or Ron Paul, and yet intellectually I recognize that Kynes' arguments are functionally sound. My conclusion is that the current ecology doesn't permit for either system to function properly and that the economic difficulties we're experiencing aren't due to systemic mismanagement but rather due to obsolescence. I don't think anyone will go very far in a debate like this; it's like arguing whether it's better to use slave labor or use mules to farm a field: the answer is neither, you should buy new machinery. And I'm quite convinced that both sides of the issue honestlybelieve that their model is correct, so Greg I don't agree with you that the conviction from the other side comes from being conservative and therefore biased. The Austrian school is far closer to the intention of the Founders and also is more aligned with constitutional principles so I completely understand why it has intellectual appeal. Functionally I believe that any free system degrades inevitably into tyrannical oligarchy, but the spirit of the argument is very libertarian and I like it. To me this is a good example where they're arguing something good but the implementation won't go the way they intend, but likewise the alternative shouldn't be to scrap the ideal behind that system along with the mechanism. There seems to me to be something equally wrong with punishing those who create jobs in order to 'level the playing field' so that they aren't too successful. Even the idea of that sounds silly, and for those who love Ayn Rand's books there's a reason why they most likely recoil at the idea of the industrious and successful being told they're bad for doing well.

[rightleft22]

 We often don’t experience the long-term effects of an Administration policy until the administration is no longer in power. I think the difference is a perspective of short term verses long term gratification.

If the Past is the best predictor of the future under the Republican administration – government control and size will grow, business freedom unregulated and white color crime increase, while personal freedoms are regulated… eventually the bill for the short-term gains come due.
Not to worry though when the bill comes due we blame the other guy, and no one will be held to account, so the cycle continues.  We don’t learn from history

[Fenring]

If the Past is the best predictor of the future under the Republican administration – government control and size will grow, business freedom unregulated and white color crime increase, while personal freedoms are regulated… eventually the bill for the short-term gains come due.

That's the thing, though: neither party really believes in their stated principles, and both cater primarily to special interests. Do you really think the Republicans are in the business of implementing an Austrian economic approach? Actual Republican policy is as far from Seriati's views as Greg's are. There's a big difference between your fiscal policy being a failure and simply being corrupt, and the two don't really have anything to do with each other. I'll put one proviso on that, though, which is that unregulated environments will be more amenable to corruption than correctly regulated environments. Contrariwise, what we see now is that both parties believe in certain kinds of regulation, and for the most part it's geared towards cementing the corruption into being unalterably systemic. It's a problem: deregulate and the wolves move in, but if you let the wolves design the regulation it's even worse.

[TheDrake]

for those who love Ayn Rand's books there's a reason why they most likely recoil at the idea of the industrious and successful being told they're bad for doing well.

We would also recoil at the idea of an all-powerful oligarchy. Her books depict man qua man, and so the very ideas of price fixing, giving your nephew a million bucks to invest in property, and other behaviour observed with "capitalism in the wild" would be rejected along with those who practice it.

She depicted competitors battling on the strength of their ideas, not colluding to crush their opposition. She depicted employers compelled by morality to pay a fair wage and reward merit.

Would that our system operated on Objectivist principles, and there would be no need for regulation.

None of this stops 80% of business folks to hand out copies of Atlas Shrugged and use it to justify behaviour in total opposition to Objectivist values.

[Fenring]

She depicted competitors battling on the strength of their ideas, not colluding to crush their opposition. She depicted employers compelled by morality to pay a fair wage and reward merit.

Would that our system operated on Objectivist principles, and there would be no need for regulation.

That's nice, and who enforces this moral economic system? And if it's not enforced, how are the 'moral entrepreneurs' expected to compete against Amazon and Walmart and avoid their fair system being crushed? You end up in a contradiction, where you desire an unregulated environment which can only function under the auspices of intense regulation. The game rules will determine the quality of play in the long run, not the attitude of the players. With a small group, like your family, you might get by on house etiquette, but the larger the player base (a nation) and the higher the stakes (life and death) and the etiquette will be replaced by 'optimal play' as determined by the ecosystem. Nothing will change this, making it all the more important to establish a healthy game ecosystem in order to make possible a moral axis of behavior within the system. It has to be either equally successful or more successful to survive, so immoral behavior has to become also inefficient behavior in a well-designed system. I doubt that without a hive-mind technology that can be achieved without intense regulations determining the rules of play.

[TheDrake]

Fenring, I never said it was a viable political system. It never has been, really, which is why I support regulation in the attempt to cage the unprincipled animals that dominate the majority of US businesses (and probably elsewhere).

How it could be "enforced" without government is that the men of the mind refuse to do business with the people who are shady, unethical turds. Suppliers would just pass on doing business with Walmart and sign up with Costco. When the government messed up Roark's project he blew the damn thing up. When Rearden was ordered to hand over his patent, he (at first) simply refuses. Wyatt sets fire to his oil fields. While those are dramatic examples, there are more subtle ones in the book. The principle is not to live exclusively for profit, but rather to live for self-interest. These are not the same thing, although they are intertwined. Roark turns down lots of jobs and makes less money in the name of his self-interest.

#1 It should be recognized in their own self interest - Costco regularly gets beaten up by analysts who say that they ought to compensate their employees less so the profit can be sweeter. Costco knows better. Costco has a P/E of 27.7, walmart 17.2. Growth is higher for Costco. It is in Walmarts personal best interest to change their model from crushing employees into the ground to lift them up, but they don't recognize it.

Which is #2, don't work for unethical companies and don't buy their products. We've seen some of this sentiment lately but it needs to go a lot farther. I've had my personal battle with Wells Fargo. I should have cut ties with them over their widespread fraudulent account opening. I haven't, and may not. Partly because I prefer a large bank to credit unions for their various amenties, including great online interface and available ATMs. I already avoid Chase, B ofA, and Citi for previous ethical flaws.

#3, if you're inside a company and spot unethical behaviour, blow the whistle. Put it in the paper, smash their stock prices. Change the optimization strategy and the risk profile by making it really, really painful to blow the rules.

And so, in the meantime, yes I'm going to support a lot of regulation. I want the government crawling through WF looking for more bull*censored*. I want fraud held truly accountable, like when investment firms tell customers to buy a product while they are selling it off. I want Dodd-Frank, Sarbanes-Oxley, and every other damn thing we can throw at them until they straighten up and fly right.

[Seriati]

Thought you might be interested in this Article, it confirms that business leaders are in fact influenced by the tax reform and generally far more positive about the Trump economy than they were about the prior economies.

https://www.wsj.com/articles/tax-revamp-drives-corporate-ceos-economic-outlook-to-15-year-high-1520963290

Of course it also underscores the risk the tariff regime is imposing.

[TheDrake]

Interesting, but I don't know how much to weight CEOs who are members of Business Roundtable who self-reported on a survey where I can't read the way the questions were delivered.

That said, I'm willing to believe they are a somewhat representative group.

The share expecting sales to increase shot up to 93% this quarter from 76%

Does that seem like a realistic assessment? CEOs as a group tend to be pretty enthusiastic overall, and they are usually poor predictors of their own success. This includes some very smart people with proven track records, like Elon Musk who promises the moon and other celestial bodies, but whose companies flirt with bankruptcy amid cost overruns and late projects.

[Wayward Son]

The Republican "tax cut" is a plan that just keeps on giving.

Now it appears that it increases taxes on churches.

But to help defray the budgetary cost of those changes, Republicans simultaneously pared tax breaks for workers’ fringe benefits...

They were mainly trimming deductions companies have long taken for entertaining clients and providing meals for employees.

But Republicans also wanted to treat nonprofits equally, which proved challenging.

Because those organizations don’t pay income taxes, lawmakers couldn’t take away fringe-benefit deductions. So instead they created a 21 percent tax on the value of some of nonprofit employees’ benefits.

The main benefits affected are transportation-related, like free parking in a lot or a garage and subway and bus passes. It also targets meals provided to workers and, in some circumstances, may affect gym memberships...

“What we’re talking about is an income tax on the church for providing parking to its employees — that’s what we’re talking about,” said Mike Batts, chairman of the board of the Evangelical Council for Financial Accountability, which is circulating the petition denouncing the tax...

Churches and other groups want to know how they are supposed to go about calculating the value of things like parking spaces for employees. Some wonder if the garages provided as part of clergy residences are now taxable.

Other nonprofits have their own questions.

Universities want to know if the bus services they provide for faculty and students are taxable and how they figure out how much they owe. Orchestras want to know how to treat musicians who may perform in different locations.

“At what point is something a travel reimbursement? And at what point is it a commuter benefit?” said Heather Noonan, vice president for advocacy at the League of American Orchestras.

Treasury is now working on regulations spelling out the details of how the tax will work, though the groups are supposed to have already been paying the tax. It took effect Jan. 1 and nonprofits are supposed to pay it quarterly.

Free housing to church ministers could also qualify as a taxable fringe benefit.

I hope all you religious folk out there are glad to know your donations to your church are now helping to pay for your tax cut.  Better give a bit more to defray the new costs...

[TheDrake]

These items are a form of compensation. It only makes sense that compensation gets taxed equally in one form or another, just like gross pay. I'm not sure why it is suddenly blowing up now, considering the law was like that six months ago. The earliest reference I can find was an article in politico (the one you linked).

It all seems launched by an outfit called ECFA, a Christian organization, and their somewhat limited reach. It is interesting that they are fixated on employee parking as their lead. Probably because it is ubiquitous and seems the most silly, as opposed to more tangible benefits. I'm not so sure that this is the correct application for parking that is free of charge to the general public. I mostly see this as a corporate deduction when they are paying a third party for parking - not on their own facilities.