The super rich would fork over billions more under Clinton’s plans, and billions less under Trump’s.
Most of the time, Hillary Clinton attacks Donald Trump for his incoherence over policy, saying he doesn’t have an actual plan to defeat ISIS, jump-start the economy, or defend national security.
But there’s at least one issue on which Clinton likes to stress that Trump does in fact have a set policy: tax cuts for the super wealthy.
She tried pressing the issue again during the debate:
The kind of plan that Donald has put forth would be trickle-down economics … the biggest tax cuts for the top percents of the people in this country that we’ve ever had.
I call it “trumped-up trickle-down,” because that’s exactly what it would be.
Clinton is right about Trump’s proposed tax cuts for the rich. On Monday, Marc Goldwein of the Committee for a Responsible Federal Budget shared an updated analysis of how each candidate’s tax plans would affect the top 1 percent of American income earners:
There’s a certain irony to the discrepancy in the candidates’ plans: All of the evidence suggests Hillary Clinton is the candidate overwhelmingly preferred by the super wealthy.
She is, for instance, the first Democratic nominee in more than 20 years to be leading among those making over $100,000, according to a Bloomberg News poll. She clobbered Trump among millionaires by 13 points in a CNBC poll. She also has a 20-to-1 fundraising edge among billionaires, and an even bigger one among top corporate earners.
There may be other reasons for the wealthiest Americans to think that Clinton would do the most to advance their preferred policies — perhaps because she’s a more consistent defender of international free trade deals than Trump, or perhaps because the Republican nominee’s astounding financial illiteracy is thought to have the potential to trigger a global recession that would do far more to impact bottom lines than marginal tax rate changes.
But if we’re going by proposed tax policies alone, there really is no dispute about which candidate promises to most advance the interests of America’s 1 percent.
Clinton wants the ultra wealthy to pay much higher tax rates. Trump thinks their taxes should be dramatically reduced. And yet the ultra wealthy prefer her to him by huge margins.
A world of difference on tax policy for America’s superrich
As the graphic shows, Clinton’s plan would raise taxes for the top 1 percent — those making over $730,000 — by an average of $123,570 a year. That number is a little misleading — as I explored here, Clinton’s taxes are staggered to disproportionately hit the highest-income earners within the 1 percent, so the average tax increase for someone making just over $730,000 is considerably lower.
“Her tax increase proposals overwhelmingly hit the top 1 percent, which would bear 77.8 percent of the tax change; the top 0.1 percent would pay for more than half of it,” wroteVox’s Dylan Matthews in a summary of an earlier version of her plan.
Overall, Clinton’s tax increases on the top 1 percent would increase revenue by somewhere in the order of $140 billion in 2017 alone. That money would then be funneled into an ambitious and extensive array of social welfare programs and other policy initiatives, as detailed in this recent Huffington Post report.
Clinton has a few key mechanisms for getting the superrich to fork over more dough. Among them include raising capital gains taxes, imposing a 4 percent surcharge on incomes over $5 million, advancing a new tax for incomes that surpass $1 million, and capping deductions, says Howard Gleckman, a senior fellow at the Urban Institute, in an interview. Last week, Clinton also announced a new plan to dramatically jump the estate tax to 65 percent.
Trump, meanwhile, would give the top 1 percent an extra cash cushion in the range of $162,000 a year. His butcher’s cuts include repealing the estate tax, enacting a massive $2.4 trillion reduction in the corporate tax rate, and gutting the individual income tax rate by $4 million. On average, the wealthiest Americans would each pay about 10 percent less in taxes each year — or about $185 billion less in 2017, according to Goldwein’s rough projections.
(Trump’s initial tax plans included even more regressive giveaways to the top income earners. But as Matthews explains, it’s still wildly expensive.)
Now, some caveats are in order here: Goldwein’s analysis is based on one think tank’s estimate of incomes for 2017, though Trump’s plan is based on a different think tank’s estimate of incomes for 2016. (So there may be some distinction in the definition of the “top 1 percent.”) His analysis also doesn’t include the candidates’ health care plans, or the impact of Trump’s proposal to repeal Obamacare — so we may be selling the extent of their differences short.
But the bottom line is clear. Clinton may be the candidate preferred by the superrich. But her plans seem to suggest she’s probably the more imminent threat to their checkbooks.