RUSH: Trump was in Washington, the National Association of Manufacturers. He went out to pitch his tax cut idea, and I want to play these two before we get into excerpts of my interview last night with Sean Hannity, which starts with the tax plan. So here’s the presidnto excerpts of my interview last ent, the first of two bites just this morning.
THE PRESIDENT: The single best tribute to our workers can be found in the unmatched quality and craftsmanship of the amazing products they bring from the blueprint to the storefront. “Made in the USA” is a global symbol of unrivaled excellence. My administration is working every day to lift the burdens on our companies and on our workers so that you can thrive, compete, and grow. And at the very center of that plan is a giant, beautiful, massive, the biggest ever in our country tax cut. (applause).
RUSH: And the applause went on. Here is Trump emphasizing — well, here, I’m not gonna characterize it. You just listen to it yourself.
THE PRESIDENT: Our framework also provides relief to those who care for an older loved one through a $500 tax credit, something that everybody has been wanting so badly for so long, by eliminating the tax breaks and special interest loopholes that primarily benefit the wealthy. Our framework ensures that the benefits of tax reform go to the middle class, not the highest earners. That’s why we also have given Congress the flexibility to add an additional top rate on the very highest income earners to provide even more tax relief for everyday working people.
RUSH: All right, now, I’m sorry, that doesn’t equal growth. If this tax plan is about growth — this is the surcharge. Let me go through this. “Our framework provides relief to those who care for an older loved one through a $500 tax credit, something that everybody has been wanting so badly for so long. By eliminating tax breaks and special interest loopholes that primarily benefit the healthy, our framework ensures that the benefits of tax reform go to the middle class not the highest earners. That’s why we’ve also given Congress the flexibility to add an additional top rate on the very highest income earners to provide even more tax relief for everyday working people.”
That’s just another way of saying we’re gonna levy a surcharge on the top 1% in order help pay for tax cuts for everybody else. Now, that’s Democrat Party language. And I know, folks, that there is no way that anybody is going to succeed defending the rich. I’m not doing that. I’m not defending the rich. I’m actually defending the concept of economic growth. That’s what the proponents of the tax plan say that it is, that its purpose is, and if that is the objective, you’re going to have to cut taxes across the board.
You can’t leave out people who hire. You can’t leave out people who invest and grow things. But, furthermore, to try to attract support for it by blaming all this on the fact that the upper bracket isn’t paying enough? That’s the kind of language that might bring the Democrats into the fold on this. But nobody ever succeeded in defending the rich when it comes time for tax cuts. Most people don’t even try. And that’s not what I am doing here. I’m very uncomfortable with this whole idea that the tax cut has to be paid for. Why does it have to be paid for? If we’re trying to stimulate the economy further, we need to actually put more money in the economy. The way you do that is take less out of it.
The way you do that is you cut everybody’s taxes. You know, every dollar the government takes is a dollar taken out of the economy, and every dollar taken out of the economy is a dollar that cannot grow. If the government is holding it, it cannot grow. Government doesn’t create wealth. The government redistributes wealth and destroys it, but it does not grow it. If you want the economy — some people call that “the private sector.”
If you want that to grow, you have to leave money there. It’s like Obama’s stimulus. There was no stimulus. Obama, the media, the Democrats wanted everybody to believe, “Hey, you know what? We found almost a trillion dollars over there in the Treasury that was just sitting in an account! It wasn’t being used! So we decided to take that trillion and grab a syringe and just inject it into the private sector.”
That’s not what happened. There isn’t a trillion dollars sitting around somewhere. There’s not $500 billion sitting around. We’re $20 trillion in debt. There isn’t any money sitting around. For Obama to get that stimulus — let’s call it a trillion; that’s rounded up — he had to take it from the private sector in the first place. It was a net zero wash. Was there any economic growth at all to speak of during Obama’s seven years, eight years? There wasn’t.
The reason we’re having growth right now under Trump is attitudinal. The Trump agenda — the promises of tax cuts, the promises of getting the albatross of health care fixed, the prospects of limiting illegal immigration in the country and not putting pressure on Americans in the job market. All of these things led people to a more positive attitude, which led to what we now have as a second quarter growth rate of 3.1%.
Obama never saw anywhere close to 3% in eight years. But we were growing seven, eight percent in the eighties. And we could do it again, but you can’t do it if you take money out of the economy and give it to government. This is populism. This is telling the middle class, “The only way that we can give you a tax cut is by not giving a tax cut to some of your fellow citizens and raising the taxes of other of your fellow citizens. That’s the only way we can do it.” And so the people getting a tax cut say, “Well, then you go right ahead!
“If the only way I can get a tax cut is you gotta take it from somebody else, then you go right ahead.” That’s populism. That’s not conservatism. And it continues the myth that all money is Washington’s and none of it is yours. And what you end up with is through the good graces of government policy. But it continues the myth… Well, it’s not a “myth.” It continues the notion that all money in the country is owned by Washington, and what you end up with is the result of government policy.
And so you are campaigned, you are persuaded to support government policy that allows you to keep more of what you earn. But now we’re running around talking about, “The rich don’t need any more relief. I don’t need it; they don’t need it. In fact, we’ve put flexibility in there so Congress can actually tax them even more to ensure that you get your tax cut.” It pits people against each other, creates class envy. It’s unfortunate.
BREAK TRANSCRIPT
RUSH: I want to go back to this, the last thing Trump said in that second sound bite. “That’s why we also have given Congress the flexibility to add an additional top rate on the very highest income earners to provide even more tax relief for everyday working people.” Pitting… This is not… Folks, I’m sorry, this is not right, and it’s not necessary to sell this.
This is how Democrat presidents sell this kind of stuff, and they sell it as a tax increase on the rich. That’s how they sell it. They never sell tax cuts ’cause they don’t believe in ’em. So when they want to change tax policy, they lead with punishing the rich, raising taxes on the rich. Nobody gives Congress the flexibility. Congress owns the flexibility! Congress! The constitutionality of generation of revenue, tax policy, spending all originates in the House of Representatives.
Nobody gives them flexibility other than the Congress, unless the Congress willingly sacrifices its power. Which, when the Democrats ran Congress, they gave up all kinds of power to Obama ’cause they don’t mind dictatorships and authoritarian figures when their side’s running things. If you really want to “pay,” Mr. President, for this tax cut, then start cutting some agencies. Get the government smaller. There’s overpopulation in all these bureaucracies, redundancy.
You got programs and people that you could get rid of 50% of and not affect the objective of these programs. Why make the high earners and the achievers in this country…? Why put the onus on them? The only way working people can get a tax cut is if we raise taxes on these people? It’s unnecessary, and it’s not right. I mean, you say you’re gonna drain the swamp, drain the swamp. You want to “pay” for a tax cut? Get rid of so much redundant government spending.
Here is Jim in west-central Florida. Great to have you, sir. Welcome to EIB Network. Hi.
CALLER: Thank you, Rush. So directional gyro dittos, you know?
RUSH: (chuckling)
CALLER: I believe that many of the problems our country faces today at the root cause is the failed education system that has been ruined by the liberals ’cause they’ve been running it so long. And then they go out to college and then they graduate and become absent-minded college-educated idiots that don’t understand the definition of words. They’re socialist indoctrination centers basically is what it is.
RUSH: I think not only is that true, we had column by Walter Williams earlier this week in which research and studies indicated that way too many high school graduates today and college freshmen have an eighth grade level of education. Eighth grade! They’re adults, but they’re eighth grade in their knowledge and so forth. Nobody would disagree with you on that at all.
BREAK TRANSCRIPT
RUSH: No. No, no, no. I done be gonna telling you why. Everybody, “Why is Trump doing this,” people say, “Why?” You know what people remember. The best tax plan, folks, the best tax plan for the United States economy is a tax plan that takes the most money out of wasteful government bureaucracies and programs and puts that money back into the economy in the form of a tax cut. You let people keep more of what they earn, you shrink government, get rid of unnecessary, burdensome regulations, which Trump has made a good start at but there’s still so much.
They say, “Well, it’s all entitlements, Rush, you can’ –” There’s so much bureaucracy you could cut it in half and not impact a thing in terms of precious government services. Anyway, you take the most money you can out of government, you put that back into the economy so the economy can grow. You can’t grow an economy if you take money out of it. And any tax cut for the middle class that is paid for by taking the same amount of money away from other Americans is not gonna grow the economy. It can’t. The numbers aren’t there.
It’s mathematics. And this is what Trump meant when he said he wanted to make America great again by making America rich again. You can’t cut some people’s taxes and let them keep more of what they earn and then say we’re gonna pay for that by increasing taxes on some Americans because you’re taking that same amount of money back out. While you put it in, you’re taking it back out if it must be paid for. And so the economy does not grow, you’re not putting additional dollars into the economy. So people, “Well, why is Trump doing this?”
Very simple, folks. Populism — let me cut to the chase. Trump believes that this is what his voters want. Everybody thinks that the rich need to be punished. This is an axiom in politics that’s way older than the U.S. The rich are perennially resented and unpopular. And nobody is gonna have any sympathy for them if their taxes are raised. It’s quite the opposite. Most people think that the way you build a bond of relatability to people, the way you strengthen your attachment to voters is tell them you’re looking out for them and you’re gonna get the other guys. It’s the way the Democrats have always done it.
But every party, every politician will come along, “We’re gonna increase taxes on the rich, they don’t need it.” Remember Richard Gephardt? We got a soundbite of Richard Gephardt, Democrat congressman from Missouri, he actually said during a speech supporting tax increases on the rich as a way to grow the economy, imagine that, tax increases on the rich to grow the economy, Gephardt said (imitating Gephardt), “I have a friend, I have a friend, and my friend told me that if you really want to make me rich, you’ll raise my taxes.” Remember that sound bite? We’re sitting here scratching our heads over that, ’cause it’s patently untrue. It is fabulously false.
There isn’t a rich guy around that will tell anybody, “You want to make me rich? You want to make me richer? Then you’ll raise my taxes.” If that were the case, the rich would be firing their tax accountants and they would be paying more than they owe, if that’s the route to wealth, then that’s what the rich would be doing. But it isn’t, is it? The rich are the people using every legal advantage they can find in the tax code to not pay taxes. And, by the way, that becomes a story, and so soaking the rich is a very popular thing for any politician to promise or to say he’s gonna do.
But I’m gonna tell you, if you’re sitting out there in the middle class, and you’re told that your tax cut is going to be paid for by somebody else’s taxes going up, you should realize that doesn’t mean the economy’s gonna grow, and usually the people whose taxes are going up are the people you hope will hire you someday or give you a raise.