Massachusetts gets screwed under Republican tax plan

The Globe reports on the impact on upper-middle-class residents, of the sort Massachusetts has a lot more of than, say, Oklahoma. The Chronicle of Higher Education reports on provisions that would particularly screw colleges and universities, of the sort that Massachusetts has a lot more of than, say, Oklahoma.

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    There is only political purpose behind the bill.

    Putins pick has stated that "some states do better than others with spending taxes". This is a shot across the bow of northeastern states and California. When people can't deduct property tax they will resist funding local expenses enhancing republicans long term goal of privatizing government services. In addition it sets the table for a deficit discussion where we will need to gut "entitlements" because of the "out of out of control spending", "illegals", "takers" etc. I just don't want to hear bitching from Trump voters when their Social Security or government pension gets eliminated.

    Bush/Obama economy screwed them for you

    Their economy was, global business, technology, health care, education, real estate and finance, offshore the dirty stuff & farming, blue collar whites and immigrants serve the professors executives etc. If there was industry it was clean tech.

    Red States

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    Are the ones who don't know how to make and spend money.

    Why should we pay for their poor financial management?

    Reference: Kansas is doing poorly, while its neighbors do better; Wisconsin and Michigan in the toilet while Minnesota flourishes, etc.

    You mean....

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    Just capitalism? Industrial/blue collar jobs have been being automated/mechanized/out sourced well before Bush/Obama. Like the textile/clothing industry, factory jobs aren't ever coming back unless its to fully automated facilities that no longer need labor (other than the tech to keep things running).

    Universities here are sweat shops

    Mass economy is imbalanced. Too reliant on non-profit education and health care, which are low-productivity industries.

    Trumps plan will be good for a whole other set of business. Go work for them instead of getting peanuts at Harvard , what do you care?

    Low productivity?

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    We can argue about whether universities are paying their fare share in lieu of taxes (why, hellooo there Northeastern University), but, please, where do you think all those companies along 128 back in the day and now along 495 and in Kendall Square, the Seaport, etc. would be if not for our local colleges and universities?

    How to tell if your industry is low productivity

    What kind of yearly raise do you get working in healthcare or education.

    A few administrators make a lot of money in hospitals and insurance, maybe the fundraising people at colleges. The rest are there for security-- by definition low productivity. Like a government job.

    I get a 3% annual raise at

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    I get a 3% annual raise at Harvard, negotiated by my union.

    At a high dollar consulting firm where I worked, it was performance based, between 1% and 5%.

    At a just-past-startup tech company where I worked, there was no yearly raise, but there was an annual bonus depending on company performance.

    LOL- RAISE?

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    I work for a giant global corpration that will do VERY well under this tax plan. What kind of raise will I get? Probably NOTHING. my company did not give raises for about a decade, we finally started getting them. know what my last raise was? 41 cents an hour. Universities and hospitals pay MUCH better base pay and cheaper (to the employee) benefits, so the NEED for big yearly raises isn't there, they already get paid pretty well. In my case I get paid shit with shit raises. The CEOs (hell even district management) gets bug bonuses every quarter. thats exactly where the savings will go in this tax plan. That and stock buy-backs, so that stock prices go up, then they can sell them off at a profit riiiight before the market dips again.
    Its an ongoing cycle that repeats itself every 20 years. Try and keep up dude....
    EVERYTHING Trump's admin is doing is a call back to Reagan, right from the very beginning of his campaign stealing Reagan's slogan! Right up to the recent "ad campaign" to combat opiate addiction (maybe we'll get Melania marching in the street for a JUST SAY NYET campaign).
    These are all policies that were proven failures 40 YEARS AGO. But...lets give it another shot? How are people this stupid?

    Professors and support staff

    Professors and support staff (administration) are paid well and get good benefits and excellent retirement via TIAA-CREF. For example, Cornell profs' kids go free if they get in, Adjunct profs get screwed on pay as do food service and graduate assistants but they're organizing.

    Research done at our best in the world colleges and universities has driven our economy for decades. Expertise is underrated.

    This cut cut cut tax bill was written behind closed doors by Republicans. Most of the benefits go to corporations. It blows a big hole in the budget because it's deficit financed. It's a huge transfer of wealth from workers to capital.

    Well,

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    I have worked for three Boston area universities in a support staff capacity. I don't know which universities you are thinking of, but I would not say I was "well paid" in regards to making a living wage.

    Worked for a person who had

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    Worked for a person who had just left Harvard for Northeastern. Neither paid their support staff well.

    Quick question

    Which of these "other businesses" will not only offer livable salaries, but also the same benefits (employer-sponsored health coverage, paid sick and vacation leave, etc) that most higher ed and healthcare institutions provide? While also paying fair taxes....?

    Again,

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    I have worked for three Boston area universities. Although the benefits were adequate, I can say, as support staff, my annual salary fell short of being a livable salary.

    Only 3?

    I've worked for 5! With all but one I would classify my salaries as livable for my circumstances, small apartment, car-free no kids. But my jobs in other industries have been comparable or slightly worse, with few or no benefits.

    Great!

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    You are lucky. It all depends, however, on what positions we are talking about. Were you management or clerical? White collar versus blue collar or pink collar? Is there a Union (or, although, that may or may not be beneficial)? When I mention livable salary, it means livable that someone can get a job where they can afford to live to the circumstances that face them. That includes housing that is adequate and no more than 30% of their salary and in a safe neighborhood, a commute that is reasonable, a chance to perhaps afford a vacation for respite, perhaps start a family and save for retirement (just to name a few).

    Lets put in this way, if you had to move to a more expensive apartment and get a car, would your current salary be livable?

    Why are you making this specific to universities?

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    Very few support staff in any industry would make your definition of "livable" in a city like Boston. What you do get from working at Universities (and I have worked at two) is the opportunity to gain credentials, usually for free, so that you are more able to achieve a living wage in the future. I work for a private company now, and our support staff are not paid much more than University staff, have fewer benefits, little tuition reimbursement, and less stability.

    To clarify..

    1) The "but one" job was a union, assistant director level position that paid better than the others.

    2) My overall point, not well stated above,is that I don't trust that other industries would offer better opportunities.

    There you go.

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    When I was working for these universities I was support staff with salaries to match. If I was an assistant director I probably would not be typing these words.

    Understood.

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    But I have to say, I work in Kendall Square now and the industries around me, for my past line of work, pay much much more than my current employer (where I love working) knowing colleagues who have left and moved to those companies).

    War of 1st person perspectives?

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    You guys realize that a single person's immediate experience, no matter how central to the point under discussion, is inadequate data with which to claim broad categoricals, right?

    Don't bother arguing with this idiot

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    He's shown time and again that his grasp of economics is very weak and Libertarian Kool Aid flavored. Add in his cocksure absolute insistence that he is somehow correct and you get a worthless moron braying like a donkey.

    ProTip: what you "believe" and what is actual, researched, and real ARE TWO DIFFERENT THINGS. You clearly have no aptitude for the former - and your whining about people who know things makes that damn obvious.

    Just go move to Kansas already. It's already been destroyed by morons like you.

    Oh honey

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    Oh honey.

    You are a dim one, ain't ya?

    Go back to that Playmobil garage you call "my small business" and move the figurines around a little more.

    By and large

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    Blue states subsidize red states, not the other way around. This just means we have to bail them out even more.

    Says the guy ...

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    ... who claims to own a business (doubtful, given poor grasp of basics) and crows about not paying his alleged workers much and not paying for benefits, and then whines about raising minimum wage because he can't be bothered.

    I need rich people

    We serve the executive class. Unfortunately they are the only people with the growth in income who will pay for craft in this country. Everybody else is getting Home Depot/IKEA furnishings. I would love it if my friends who work in government, non-profit etc. could afford what we make. They just can't because monthly expenses soak up any raise they get. This is the only way for growth of small manufacturing of any kind in the us.

    Schools and hospitals are low

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    Schools and hospitals are low productivity? Feel free to move to a red state like West Virginia where they don't invest in education and healthcare. You can hang out with Trump voting obese illiterates and then die at a pathetically young age because red states have awful average life expectancy.

    How education is low productivity

    Never said education doesn't make you more productive.

    I said education is a low productivity industry -- because the employees do not make leaps in how many or how well or how quickly they teach their students.

    In fact it has gone the other way. What used to take six months in the job training now seems to take two year degrees, then four years, which actually take you six years to finish, and now that's not good enough, you have to get a phd for the same income.

    Nonsense

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    Just the Umass University system adds 5 billion to the MA economy alone.

    That creeping education requirement is business requesting a more educated work force. Not the education system forcing more or slower learning on people. Business requires blood from the stone, and they'll wait till they find that candidate, even for admin work.

    Mortgage Deduction needs to go away entirely

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    That seems to be the biggest distortion I can think of.. totally bogus that they aren't phasing it out for everyone. It primarily benefits old, wealthier people so now younger people are at an even bigger disadvantage trying to buy a first home.

    Stupid they are doing something that will cost another $1.5T

    Corporate tax rate is probably the only good news given the US is of the highest around the globe. The rest being a crap shoot whether it helps or hurts.

    Weaponizing the tax code (like democrats did with the IRS under Obama) is an awful, awful idea/slippery slope though.

    Huh?

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    Seems like you are contradicting yourself - on one hand you are saying the mortgage deduction needs to go away for all, but then you say how younger people will be hurt by this more - and you are right. Being able to deduct interest off a $400K+ loan helps make the house more affordable than it is. Getting rid of this is either going to shut out more buyers, or cause existing owners to take a loss due to a drop in property values. If the mortgage deduction is lowered or removed, I expect it to have a short term, negative effect on the economy. Eventually, the economy will sort the effects out.

    My question is - is the deduction per home (500K per home), or total regardless how many mortgages you have with different properties?

    I would have allowed the mortgage deduction with the original up to 1 million write off for primary resident only, and not applied to 2nd homes and rental properties (you already get to write the mortgage interest as an expense for rentals).

    Ah, property values

    The biggest, most inefficient crock of (expletive) in human commerce. If the house isn't for sale, the value is $0, because you can't and won't reduce your standard of living to a refrigerator box or the Pine Street Inn.

    I'm going to go reread the chapter in The Big Short about the guys who got rich betting against some deadbeat house buyer and the deadbeat bank who lent them the money and turn absolutely green with envy.

    Distortion?

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    Young people are at a disadvantage to buy a home because there are not a lot of starter homes on the market right now, and home prices are a lot higher than they were a few years ago when the housing bubble burst.

    I'm fairly young, not terribly wealthy, and I really love the mortgage deduction on my taxes. Granted, it only makes sense for me since I can also deduct state taxes and property taxes, otherwise I would just use the standard deduction.

    Interestingly, this tax plan limits future home purchases that are eligible to take the mortgage deduction to a max of a $500,000 loan - which, unless you are making a sizable down payment on your mansion, is going to help the middle class more.

    Maybe... except if a home is

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    Maybe... except if a home is investor-owned and rented out, then the investor can deduct a mortgage loan as a business expense. Shouldn't a homeowner get the same benefit?

    The mortgage deduction isn't what it was 30 years ago, anyway, with 3% interest rates compared to over 10%.

    Probably the biggest loophole in today's tax code is how capital gains / interest income is taxed les than regular earned income.

    Old people don't usually

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    Old people don't usually benefit from the mortgage deduction. Many of them have no mortgage because they paid their house off. Or their mortgage is tiny because they bought many years ago when houses cost less. Very wealthy people often don't have mortgages. They just buy houses in cash or are trust fund brats like the Trumps and Bushes who inherit them from Daddy. Taking away the mortgage deduction hurts the middle class the most. Getting rid of the estate tax only helps super rich trust fund brats. The republicans only give a damn about the 1% and their tax plan shows exactly that.

    The IRS under Obama story was a whole lot of nothing. Not one conservative group had their tax exempt status denied.

    Funny how republicans

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    Funny how republicans complain about welfare yet all the tax cut hand outs go to republican states and the one percenters who have bought the republican party and make up Trumps cabinet.

    What category are you if you

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    What category are you if you make $60 K? Is that upper middle class or middle class ? Does anyone have a breakdown of the categories? I tried Google but all I found were articles.

    Bad for Mass. always good for the country

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    This state kills me

    Whenever something good is on the mend for the country, it's bad for Massachusetts. Take healthcare: Trumps new healthcare overhaul is good for the country, but bad for Massachusetts. Trump's Tax cuts: Great for most Americans in the country, but bad for Massachusetts.

    Maybe if this state got on the right track with the rest of the country, people here would be better off with such new policies. But since the state is run by liberal Democrats, expect all the good things that are happening for our country will be considered a bad thing for Massachusetts. What a joke!

    Bingo

    We're a net payer of federal funds. One would think the red states who take from us would increase their standard of living to become closer to ours.

    Vote Democrat and Republican again.

    A collection of weird statements...

    Donnie - Your premise that Massachusetts governance exudes contrary economic reality is not remotely accurate. In fact, your statements are not merely flawed but are also some combination of dishonest, incompetence and logical absurdity. You might want to take a bit of time to study what the GOP tax plan would actually do.

    Among other things, it would cut the corporate tax rate from thirty-five per cent to twenty per cent; allow corporations to expense their capital investments immediately; set a new rate of twenty-five per cent for so-called pass-through businesses, such as partnerships and sole proprietorships; allow multinational corporations to repatriate trillions of dollars they are holding abroad at a low tax rate; abolish the estate tax; abolish the Alternative Minimum Tax; and reduce the number of personal-income tax brackets from seven to three.

    The provisions of the plan are heavily slanted toward corporations and other types of businesses. According to figures compiled by Ed Wolff, an economist at N.Y.U., the richest ten per cent of U.S. households own more than eighty per cent of all stock-market wealth. And, as the market has risen in anticipation of the Trump tax plan passing, these wealthy households have already enjoyed a substantial windfall.

    According to a preliminary analysis of the Trump plan by the Washington-based Tax Policy Center, taxpayers in the middle of the income distribution would get a tax cut of six hundred and sixty dollars a year—about one per cent of their incomes—while taxpayers at the very top of the distribution would see their post-tax incomes rise by $129,03 or 5.7 per cent.

    The claim that cutting corporate taxes will generate a leap in corporate spending is based on the idea that firms have held off making capital investments because of high tax rates. As William Gale, an economist at the Brookings Institution, pointed out this week, “Over all, the cost of capital is already low.” To finance their investments, firms today can borrow at record-low interest rates.

    Another argument sometimes made for corporate tax cuts is that, by reducing the amount of money firms have to give the federal government, they boost corporate cash flows and make it easier for firms to invest. But, as Gale also pointed out, “A lot of big firms right now don’t have cash-flow problems. They already have a lot of cash laying around.”

    In reality, low rates of capital investment may not have much to do with the corporate tax rate—which is already a lot lower than thirty-five per cent when you take into account all the loopholes in the tax code that businesses can already exploit.

    The real problem appears to be that many firms can’t see enough profitable investment projects, or sufficient demand for their products, to justify expanding capacity and upgrading their equipment. Rather than taking this risk, corporations are using their profits to buy back their own stock, a tactic that also just happens to benefit senior executives who own a lot of that stock. The Trump tax plan wouldn't do much to address this problem.

    The 1986 tax-reform package, which the White House describes as a model for the Trump plan, cut the corporate tax rate from forty-six per cent to thirty-four per cent, Gale recalled, “but it’s not considered generally to have had a huge impact on investment.”

    “Caveat emptor” to those who think this plan has any merit to the US economy - in fact, take a look at Kansas’ fiscal status if you want to get a real sense of what the future holds for the US economy under this GOP tax plan.

    It's not perfect like

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    It's not perfect like everything else isn't, but it's more good than bad for the middle-class. Especially, since we pay the highest taxes in the world and especially when a lot of our tax dollars are being spent in the wrong areas, like giving a lot of it away to countries who wish us dead. I think each and every one of us deserve this money back in our pockets. Thank you Donald Trump!