The Ignorant Investor

Pretty self-explanatory stuff in the Wall Street Journal today.

The chairman of the House Ways and Means Committee wants to cut the top U.S. tax rate to 25% for individuals and corporations, and cut or eliminate many popular deductions.

I understand the need to cut deductions, including ones I benefit from like the home interest mortgage deduction. But cutting popular deductions won't happen in a final bill because of the fear of voter backlash. The only provisions that will get through are the cuts for individual rates and corporations. Which means more deficits. The Republicans and conservative democrats will then demand that we reduce the deficit by cutting social security, medicare, and medicaid. It won't matter that social security taxes have been higher than necessary (i.e., in surplus) for decades and thus subsidized lower income tax rates on the wealthy. Instead, we'll be told that the poor and middle class are too greedy and that "painful cuts are required." These cuts will not be painful to the wealthy, because they don't rely on social security or medicare. But that won't matter.
It's an obvious game plan to anyone who pays attention, but most voters don't.