Every Republican ran for office last year promising to slash the record spending levels that fueled Biden-era inflation. Yet, every GOP proposal now adds to the deficit. Republicans can’t agree on a single major program to cut. At the very least, one might expect them to eliminate federal subsidies that prop up blue-state Medicaid schemes and high-tax policies. Instead, they plan to burn their political capital shielding those same states from the consequences of their choices.
Forget “inflation” or “invasion.” The buzzword in Washington this month is “SALT.” Lifting the cap on the state and local tax deduction is the message GOP leaders chose to go with. Brilliant!
Blue-state Republicans should export red-state policies, not act as lobbyists for high-tax regimes.
Salt may season food, but in tax policy, SALT leaves a bitter taste. Before Trump’s 2017 tax reforms, taxpayers could deduct unlimited state and local taxes from their federal burden, with some restrictions for the wealthy under the old Alternative Minimum Tax. This allowed blue-state politicians to raise state income and property taxes knowing Washington would offset the pain through greater deficit spending. Trump’s bill capped SALT deductions at $10,000 and lowered federal rates across the board.
Now, a bloc of blue-state Republicans has hijacked the budget reconciliation process to push what amounts to an unlimited national subsidy for high-tax states. With existing tax cuts and Trump’s new priorities already straining the budget, these Republicans want to burn $1 trillion over 10 years to spare New York and California politicians from a taxpayer revolt.
After rounds of internal negotiation, House leaders offered a compromise: Raise the SALT cap to $30,000 for families earning less than $400,000. The SALT caucus rejected the offer. “A higher SALT cap isn’t a luxury. It’s a matter of fairness,” declared New York Republican Reps. Elise Stefanik, Andrew Garbarino, Nick LaLota, and Mike Lawler. Fairness? They want the rest of the country to go deeper into debt to prop up New York’s failed policies.
Blue-state Republicans should export red-state policies, not act as lobbyists for high-tax regimes. Their job is to pressure local Democrats to cut taxes — or to help conservative voters move out. Instead, they keep fueling blue-state profligacy and shielding the very politicians who caused the mess.
Worse still, these lukewarm Republicans want to spend over $1 trillion on blue-state tax breaks instead of using that money for broad-based tax cuts that would actually boost growth. They’ve even floated raising the cap to $62,000 for individuals and $124,000 for families, with no income limits. Most of those benefits would go to households earning over half a million dollars. For comparison, the Tax Foundation reports the average American pays about $13,890 in federal income taxes. Yet, these Republicans want to let wealthy blue-staters deduct nearly 10 times that amount.
And what of Donald Trump — the be-all and end-all of the Republican Party? He pressures the Freedom Caucus to drop its demands to end blue-state Medicaid grift, but he says nothing about the SALT holdouts. Instead, he endorsed Stefanik and Lawler for re-election.
Trump left New York for Florida to escape New York’s oppressive tax regime. So why back politicians who insist on making the rest of the country pay for it?
If Trump won’t rein in these RINOs, Republicans will head into the midterms without a message — and they’ll need smelling salts to revive a self-immolated mandate.
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