Thoughts on the TCJA

At about 1 o’clock this morning the Senate voted to pass the “Tax Cuts and Jobs Act,” a sprawling piece of legislation that, when finally passed and signed into law, will fundamentally reshape the American economy. It is properly a big fucking deal, and I want to write out a few thoughts I have about it.

  1. Don’t Panic
    There’s a lot of fear and loathing in my left-leaning Facebook feed right now, and I think its a waste of energy. This bill is what the Republican party has been talking about for a long time. Yes, its a trainwreck, hastily written, poorly thought out. That’s because the Republican party is not especially good at thinking and discussing. They’re a party of feelingsman. The whole “thoughtful party of principles” blahblah is a facade. They’re not, they never were. There are individual thoughtful conservatives, yes, but the voter base is an emotionally reactive bunch. What they want is to feel like they’ve gotten even with liberals for the 20th century, and this is a major victory in that fight. If they can end civil rights and the welfare state, they’ll have done what they set out to do, although its not clear to me that their sense of justice will be satiated by it. At any rate, the important thing here is that, as bad as this bill is – and we won’t know how bad it really is for another decade at least – and as radical as it is, it doesn’t do any good to be upset about it. Furthermore, it is really important not to resent wealthy people over this bill. They may become more wealthy, particularly in relative terms, but they’ll also be increasingly isolated by this development. Achievement will cease to mean anything for the rich – they’ll just be rich, the end. People want to be recognized for being good because they really are – when you’re super wealthy, that becomes nearly impossible. Do people like you because of you, or because of money? In short: anger, resentment, outrage, fear, etc., etc. – these should be resisted as much as possible. Yes, lots of people will lose their health coverage. People will die, and suffering will be amplified throughout the country. Yes, it will have a great deal to do with this legislation. And no, there is not much you can do about it, even in the medium term, because in order to reverse the changes wrought by this bill you’d have to raise taxes and that’s nearly impossible. We can’t go back. We must go forward.
  2. The nature of the Federal government is in flux. For a long time now, the Federal government fit the description of “an insurance company with an army.” Sure, it had a bunch of other important functions too, but in terms of the economy, it is mostly a provider of insurance, pensions, and military services. As that changes, I think there are a couple of things that will begin to play out: one is how people get welfare services. My current prediction is that people will be increasingly dependent upon their employer for benefits, and that will introduce a new kind of social conservatism. Basically, a company will look for whatever reason they can find to screw you out of benefits, a paradigm that will negatively effect marginalized populations. The second part is potentially more interesting: as the Federal government’s power wanes, American military dominance may come up for questioning. I think its fair to say that the most likely source of this will be China, which is a rising power very interested in flexing their newly acquired muscles. How that will play out is anyone’s guess, but it could bring profound changes to the US.
  3. The next recession, whenever it comes, and it will come sooner or later, is going to be ugly. People will fall and the safety net won’t be there. There will be a lot of “how could this happen?” Endemic, widespread poverty is scary and it might last a long, long time. Which is basically where my head is right now. When the shit hits the fan, then what? I expect it to be fucking terrifying. Hence, the need for calm. I’m not really sure there will be a way to preserve a middle-class existance in the future. If that’s the case, its very difficult to see what that looks like in practice.
  4. Thinking about how politics might proceed in the meanwhile, I think the socialist left will become increasingly influential in the Democratic party. Politics will be become much more internally focused, and debates will revolve around minor changes to working conditions. International considerations will largely disappear. We’ll become more like the rest of the world, and the world will be increasingly ruled by unaccountable capitalists.
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