Tax Reform Boom: Consumer Confidence Soars to 17-Year High, Democrats Vow to Undo Progress

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Posted: Feb 28, 2018 10:30 AM
Tax Reform Boom: Consumer Confidence Soars to 17-Year High, Democrats Vow to Undo Progress

As the mainstream media fixates on Russia and gun control, the economy continues to hum right along.  We've been tracking the strong and improving economic fundamentals -- not to be confused with stock market gyrations -- for months, and a new data point has just emerged to bolster the case.  US consumer confidence has jumped to its highest level since 2001, demonstrating that average Americans are feeling the economic progress in their personal lives.  Bloomberg reports:

U.S. consumer confidence jumped to a 17-year high as optimism about employment prospects grew and Americans began seeing additional money in their paychecks from recently enacted tax cuts, data from the New York-based Conference Board showed Tuesday. The report reflects increased confidence in employment and incomes, which could support consumer spending. The labor differential, which measures the gap between respondents saying jobs are plentiful and those who say they’re hard to get, rose to 24.7 percentage points, the highest since 2001. Recent tax legislation signed in December may have also buoyed sentiment, as many Americans saw bigger after-tax paychecks in February due to the law. That may have helped consumers shrug off the early-February 10 percent decline in stock prices, which have since recovered most of their losses.

More and more Americans are starting to notice their fattened paychecks -- a pleasant surprise to most that is directly attributable to the new law, which cuts taxes for 80 to 90 percent of all taxpayers.  That helps explain why public support for the GOP tax reform has rocketed upward by 26 percentage points since December.  Democrats lied and fear-mongered about the Republican plan during their demagogic campaign of lockstep opposition.  But the now-implemented law has been vindicated by reality, and lots of people are starting to notice.  Including in swing districts:  

Polling in battleground congressional districts shows that voters increasingly believe the Republican tax reform law will cut their taxes rather than raise them...The polling found that, in California's 21st congressional district, 23 percent of respondents said in January that the law would lower their taxes, but in February, that number increased to 29 percent. Meanwhile, 42 percent said in January that their tax rates would increase because of tax reform; that number decreased to 30 percent in February. In Colorado's sixth district, 31 percent of respondents said in January that the tax overhaul, which President Donald Trump signed into law in December, would lower their taxes; in February, that number grew to 44 percent. The percentage of voters who said the tax plan would raise their taxes decreased from 40 percent to 27 percent over the same time period. Other battleground districts—including New York's 24th, Pennsylvania's eighth, and Virginia's second—showed similar results.

The truth is slowly but steadily eclipsing the bogus attacks.  Meanwhile, workers keep winning from the corporate side of the fresh reforms, too; the number of US employees receiving tax reform-caused bonuses has now surpassed four million, as hundreds of companies of various sizes reinvesting in workers, benefits, wages, expansion, and re-patriation.  It remains essential for Republican incumbents and challengers to actively sell the tax law to voters, making sure that people actually take a moment to compare their latest pay stubs with what they received through January.  For nearly all Americans (especially middle income earners) the change will be a positive one.  

Americans are experiencing the positive outcomes that Democrats insisted they never would.  Not only should this expectations vs. reality gap be a mark in Republicans' favor, it should hurt Democrats' credibility with voters.  The GOP would also be wise to hold their opponents' feet to the fire on the question of repeal.  Bernie Sanders and the hardcore "resistance" left-wing of the party want the tax law repealed if Democrats win in November.  Every Democratic candidate for federal office should be pressed on whether they support uprooting Americans' tax cuts and turn back the clock on the economy's recent progress:

Their base wants to hear an answer that moderates and independents won't like.  This issue could drive a wedge among Democrats and various constituencies; Republicans should exploit it.  They've earned the chance to do so, and Democrats created this problem for themselves through their absurdist hyperbole.  On the chasm between left-wing rhetoric and voters' actual lived experiences, I'll leave you with this thought:


UPDATE - Here's a story out of Ohio:

While craft brewers will have lighter tax bills this year, that savings won’t be hoarded away – it’s being put to work. Members of the Ohio Craft Brewers Association met with Sen. Rob Portman, R-Ohio, on Friday to discuss how they’re reinvesting in their businesses and people while also pushing to make permanent recent tax changes that are only for the next two years at this point...The Craft Beverage Modernization and Tax Reform Act was part of the broader tax reform packaged passed by U.S. Congress late last year. It reduced the federal excise tax to $3.50 a barrel from $7 a barrel for the first 60,000 barrels of beer produced annually at U.S. breweries making less than 2 million barrels a year. It also reduced the tax to $16 a barrel from $18 a barrel on the first 6 million barrels for all other brewers and importers. According to the national Brewers Association trade group, that could be savings of $80 million for its members. To a person, each of the nine brewery representatives shared stories of business growth. Larry Horwitz, co-owner and brewmaster at Four String Brewing Co., said his business expects to save about $40,000 this year because of the tax change. “We invest where we live and work,” he said. “We are the blue collar workers in the neighborhood.”

The article goes on to quote brewery owners describing increased wages and new hiring, with one business owner boasting that "this [tax] act went straight to our staff.”  These job creators are asking Sen. Rob Portman to make these elements of the tax law permanent.  The Buckeye State's other Senator -- liberal Democrat Sherrod Brown -- voted against the law altogether, as did every Democrat in Congress.  Will Brown, who is a hardcore progressive, sign on to the Left's push to repeal the law?