Passing Zone

Trump Talks Taxes – but What about Roads?

Blog Commentary by David Cullen, Executive Editor

October 12, 2017

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Photo: via Twitter, @realDonaldTrump
Photo: via Twitter, @realDonaldTrump

It’s one thing for a president of the United States to use trucks as a backdrop and truckers as a verbal prop in a speech flogging a policy initiative that is in serious danger of going nowhere fast.

It would be another thing if that same POTUS used the power of his office to keep pushing for an act of Congress that has a far better chance of passing – and that would undoubtedly benefit everyone in trucking along with all Americans who depend on trucking to deliver their goods.

What’s more, if that more winnable battle was won, it actually would make it far easier for that president and his party’s majority on Capitol Hill to notch other victories they promised their voters that they would secure this very year.

Yes, I am talking about the stump speech President Trump gave near Harrisburg, Pennsylvania, Wednesday night to pump up enthusiasm for the tax-reform package he has wanted Congress to pass all year. The event was part of his ongoing series of “road show” engagements that he uses (as have his recent Oval Office predecessors) to tout one or another policy goal.

At this one, the invited guests included executives and members of the American Trucking Associations, as well as representatives of local government and of such organizations as the National Federation of Independent Business. But truckers were front and center in Trump's remarks, figuratively standing in for what the president called the “hardworking men and women” of America.

“America first means putting America’s truckers first,” said Trump, warming up to his key message for the night that “our country, and our economy, cannot take off like they should unless we transform America’s outdated, complex, and extremely burdensome tax code.”

Serving as a backdrop to his open-air podium, arranged at the apron of an Air National Guard hangar, was a pair of tractor-trailers festooned with special graphics bearing the well-known slogan “I Love Trucks" and the unfamiliar one “Truckers for Tax Reform.”

In a statement issued in tandem with the president’s event, ATA President and CEO Chris Spear called on Congress to quickly act on comprehensive tax reform to help grow the economy and create jobs.

“While trucking sustains the vitality of the U.S. economy, we also carry a heavy tax burden, paying the highest corporate tax rate of any transportation mode,” said Spear. He said that’s why ATA supports Trump’s tax-reform plan and is urging Congress “to follow the president’s lead and pass tax reform by year’s end.”

The president said his approach to tax reform would achieve certain “core principles.” He said, as best as I can discern from trying to boil down his published remarks, that these are: 1) cutting taxes for “everyday, hardworking Americans” by not taxing the first $12,000 for a single individual and the first $24,000 for a married couple; 2) nearly doubling the amount of income based at the “zero bracket;” and 3) dropping the 10% bracket and reducing the 15% rate down to 12%.

Of course, the whole plan — or “framework,” as the president called it — is a little more complicated than that.

Of course, truckers want tax reform. It’s high on ATA’s lobbying agenda. Trump wants tax reform, too. He campaigned on it. Who doesn’t want tax reform? Businesses want it. People want it. Politicians want it. Even educated fleas want it. But getting it will be another matter altogether.

For starters, few things have as many devils in their details than does the United States Tax Code — and an awful lot of those devils have their own interest groups sworn to keeping them in place.

Consider that the mortgage-interest deduction, certainly one of the biggest tax “giveaways” ever, is in no danger of being eliminated by any Republican, Democratic or Trumpian tax-reform scheme. That’s despite the contention that this tax break doesn’t just benefit the so-called “middle class,” whose members all politicians aim to court. Why won’t it be taken away? Because the real-estate industry and the industries it supports — everything from construction to home furnishings — will make sure no one will ever out-lobby them and kill off their sacred cow.

The point is that true, out-and-out reform of the tax code is far from a simple legislative maneuver. It will take a lot of politicking of the good old-fashioned, horse-trading variety to get it done. And that would not be easy to accomplish even if the White House and Congress were singing harmoniously out of the same songbook. And despite the “one-party rule” in place since January, the GOP inside the Beltway is not singing out of the same songbook.

That state of affairs is obvious when you consider that no fewer than six Republican senators have signaled of late they are not ready to vote "yes" on the GOP tax reform package. Remember (and bear in mind) from the Obamacare repeal debacle that Majority Leader Mitch McConnell can’t afford to lose more than two GOP senators if he hopes to pass anything.

Even so, speaking in Pennsylvania, Trump declined to offer any sort of olive branch on tax reform to Democrats on Capitol Hill. “The last major tax reform was passed more than 30 years ago in 1986, with a large bipartisan majority,” the president stated. “I mean, it was a bipartisan bill. That would be wonderful. But sadly, the Democrats have become obstructionists. They want to stop. They don't want to do anything productive. They want to raise your taxes very, very substantially.”

And then there is the whole little matter of the House and Senate having to first agree on a 2018 budget with “reconciliation instructions” for tax reform. That has to be approved so the GOP can pass its tax bill in the Senate with only a simple majority, rather than with the usual 60-vote threshold. But wait, there’s more. Once that’s wrapped up, then the real debate can begin among GOP lawmakers on how deep to cut rates – and whether or not to offset those cuts elsewhere.

As it happens, Warren Buffet gets that true tax reform is wishful thinking; maybe the rest of us should. The Oracle of Omaha, known for calling ‘em as he sees ‘em and so often rightly so, in speaking to CNBC this month, derided the Republican effort as “not a tax-reform act — it’s a tax-cut act.” Translation: Don’t expect Congress to pass anything resembling a comprehensive overall of the tax code anytime soon — and certainly not by the end of this year… just over two months from now.

And that brings me to my modest proposal: That ATA and all the other lobbying muscle that trucking can muster be directed right now at persuading President Trump and the leaders of both parties on Capitol Hill to get their bipartisan act together and pass before this year is out — a scant 11 weeks from now — something resembling that $1 trillion infrastructure spending bill that the president has been trumpeting since the day after he won the election.

Comments

  1. 1. Jason [ October 13, 2017 @ 08:00AM ]

    We get it, you don't like Trump. I was under the impression that when you give a speech about a topic, you stay on that topic. Oh well, I guess when someone doesn't say what you want, you complain. That is why liberals were silent that last eight years, they were told what they wanted to hear. Funny, as the last administration did so much that should upset both sides, but because Obama was a great speaker and said what you wanted to hear, you let him off the hook. That is what so many folks like about Trump, he speaks his mind, and doesn't sugar-coat things to make you happy. I am not a fan of how politicians play people, but I would rather have one tell me what they are thinking, rather than hide behind carefully scripted speeches designed to make me happy.

  2. 2. Steve [ October 13, 2017 @ 02:04PM ]

    Meanwhile Trump's V.P., Pence's old state of Indiana just passed the largest Diesel Tax Hike in U.S. history which is killing all the Indiana Truckstops' business.

 

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David Cullen

Executive Editor

Executive Editor David Cullen comments on the positive and negative factors impacting trucking – from the latest government regulations and policy initiatives coming out of Washington DC to the array of business and societal pressures that also determine what truck-fleet managers must do to ensure their operations keep on driving ahead.

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