In response to Trump thunder on trade, lost jobs, Neal to talk taxes, health care
Unfair trade hurts the middle class, he said.
But U.S. Rep. Richard Neal has a response to that: So do tax cuts geared for the rich.
The Springfield Democrat, whose district includes the Berkshires, will give the Democratic response to Trump's address. It will be aired Saturday on National Public Radio. Also, the response can be seen on YouTube, Facebook and Twitter.
Neal, the ranking member of the House Ways and Means Committee, said it is Trump's hastily concocted tax reform policy that will ultimately strap Americans who aren't wealthy. So, while trade is the crux of Trump's address, Neal will focus on taxes and health care.
"It's tax week," he told The Eagle during a phone interview Thursday. "Recall that ... $2.3 trillion was borrowed to pay for the tax cuts."
The tax reform bill, signed by Trump last December, delivers permanent cuts to corporations, taking the rate down from 35 percent to 21 percent. While most people will get an immediate cut, many won't see cuts for the long term, and only half of those in the lowest bracket will get a break. The bill also repealed a part of the Affordable Care Act that, in a decade, will leave 13 million Americans uninsured, according to the Congressional Budget Office.
"It's not everything that they're telling people," he said of the "heralded" tax reforms, and added that it was done so quickly that the Trump administration already is working on a bill for technical corrections to it.
"The tax cut that he's lauding is heavily concentrated at the top, when you consider that the top [bracket] individual rate was cut down from 39.7 percent to 36 percent," he said. "Eighty-three percent of the benefit will go toward the top 1 percent of wage earners in America."
Neal said "down the road," this tax arrangement would threaten the American safety nets of Medicare, Social Security and Medicaid. Republicans — but not all — have eyed these programs for spending reductions as part of Trump's reform bill.
On Twitter, Neal takes a more aggressive stance.
"Because of the #GOPTaxScam, the middle class in Massachusetts gets left behind," he tweeted. "Meanwhile the top 5% of earners in our state receive 64% of tax breaks."
So while Trump is laying groundwork for public support of an all-out trade war with China, Neal said Americans haven't exactly had a fair shot at understanding the superstructure — or lack of one — of Trump's tax cuts, most of which have taken effect.
"It was done in five weeks, without any public hearings and not one [expert] witness," Neal said.
Neal refers to a debate over the substance and transparency of the process for the tax code changes.
Republicans countered that there had been opportunities at a number of hearings and for the questioning of a witness. But Democrats said the rushed procedure stripped them of a deep policy drill-down, one that might have better aired what Neal has been saying all along.
"It's premised again on the mistaken notion that tax cuts pay for themselves."
"It's understandable that he uses harsh rhetoric," Neal said of Trump, adding that the president "is right to challenge intellectual property theft by China, and to open Chinese markets."
But Neal does not want to see a trade war.
"I think the president should go to the precipice, but not to the edge," he said of trade relations that began to deteriorate when Trump imposed a 25 percent tariff on steel and 10 percent on aluminum this year.
"When he says [trade wars] are easily won — that's nonsense," Neal said. "I think using the World Trade Organization and the European Union to counterbalance China makes a good deal more sense."
China, wielding a targeted political calculus, hit back with a heavy tariff on sorghum imported from the U.S., and is threatening the same with the soybean export market, a situation promising political fallout in the farm belt.
In his address, Trump decries $12.5 trillion in trade deficits, and watching "as nearly one-third of manufacturing jobs disappear or go to other countries" in the past 20 years.
As Trump said he was eying duties on an additional $100 billion in Chinese imports, China warned of a "fierce counter strike."
All of this could drive up consumer costs, Neal said.
Asked if Trump's fiery trade stance will help Americans regain jobs and economic footing, Neal said what is needed is an American workforce trained in new skills with a new approach. He said the decline in support for vocational education was just one culprit.
"The reality is that there are 2.2 million [manufacturing jobs] open right now in America," he said. New England currently has 18,000 precision manufacturing jobs open, he added.
Neal said today's manufacturing world has changed.
"You're going to need an education beyond high school to do many of these manufacturing jobs today."
Heather Bellow can be reached at firstname.lastname@example.org or on Twitter at @BE_hbellow and 413-329-6871.
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