Not One Penny Memo: Republicans’ Abhorrent Tax Law Failed in The Midterms

FROM: Not One PennyNot One Penny - Logo.png
TO: Interested Parties
DATE: November 7, 2018
SUBJECT: Republicans’ Abhorrent Tax Law Failed in The Midterms

Yesterday, the American public voted for a Democratic majority in the House. Voters resoundingly declared that Republicans’ sole legislative achievement—the Tax Cuts and Jobs Act (TJCA)—was a failure, rejecting both the GOP’s tax scam and the Republicans who championed it.

When the GOP passed their tax bill last December, Mitch McConnell confidently said, “If we can’t sell this to the American people, we ought to go into another line of work.” Now that House Republicans have been voted out of office, the American people have told House Republicans to find new jobs.

From Florida to Iowa to Maine, Americans saw through the money and spin that Republicans poured into races promoting their only legislative accomplishment. In fact, this week, a Change Research poll of voters in GA-06, MI-06, MI-08, NC-13, OH-01, and VA-02 showed that those polled were less likely to vote again for their representatives because they had voted for the tax bill.

Despite the GOP claims that this bill was a middle-class tax cut, more than half of all Americans will actually see their taxes increase. Earlier this year, CAP Action Fund showed “for Americans, real wages are stagnant and even declining because consumer prices (costs for everyday spending) are rising,” all while corporate profits are skyrocketing.

Prior to the bill’s passage, Senator Susan Collins claimed lowering the taxes on corporations was not meant “to encourage stock buybacks, which tend to enrich the executives of a firm.” Despite corporations receiving over a trillion dollars in tax giveaways, a 99 percent of companies said the GOP tax cuts didn’t prompt them to increase wages. In reality, the tax law just pushed the total amount of stock buybacks authorized by companies to a record $786 billion.

Democrats’ victory in the House of Representatives last night shows that the American people saw the tax bill for exactly what it was—and rejected it. Now, it’s clear Americans are demanding tax fairness and economic justice, not tax cuts for the wealthiest individuals and largest corporations.

GOP’s Tax Law Remained Wildly Unpopular

Republicans staked everything on the fight for their tax plan even though, at the time of the bill’s passage, it was one of the most unpopular pieces of legislation in recent history. After its passage, poll after poll has shown that the American people continue to oppose it.

The GOP had hoped to propel this bill into a winning message. Yet, in special elections in PA-18 and OH-12, they found that running on the GOP tax law was a losing issue. Just a few months later, polling continued to show that just 1-in-3 Americans approved of the tax plan, compared to 41 percent who disapproved. And support for the tax law continued to decline as the midterms approached.

Prior to the election, Not One Penny also conducted two comprehensive studies into how efforts to hold Republicans accountable for their votes on taxes and health care succeeded in key congressional districts. Those results showed that sustained, grassroots campaigns on taxes and health care targeting incumbent Republicans like Rod Blum (IA-01) moved the needle towards Democrats.

Most tellingly, a memo leaked in September 2018 showed that even Republicans’ internal polling showed that they’d “lost the messaging battle” in attempting to sell their tax law to the American public. This has been playing out in some of the top swing districts across the country, particularly those where opponents of the GOP’s tax law—like Not One Penny—educated and motivated voters.

Polling from Navigator Research showed that this campaign was successful, with over a an overwhelming majority of people—72 percent of Americans—acknowledging that this tax law made the rich even richer at their expense. A separate report from Navigator Research released showed that the GOP continued to lose their advantage on taxes as progressives vigorously campaigned against their tax law.

Last night’s election results, including Democratic victories against Carlos Curbelo (FL-26), Rod Blum (IA-01), David Young (IA-03), Erik Paulsen (MN-03), and in other key races showed what we knew all along: the American people rejected tax policy that put wealthy corporations and millionaires and billionaires before working families.

Republicans’ Broke Their Promises, and Americans Know it

After pushing their tax law through Congress without public hearings or bipartisan support, Republicans continued to lie about how their tax law would boost wages, create new jobs, and lead to economic growth. That couldn’t be farther from the truth.

  • Just after the law passed, only two percent of Americans said they had seen any benefit from it.
  • In March 2018, a majority of Americans reported no increase in take home pay.
  • In August 2018, a Quinnipiac poll indicated that a majority of voters believed their personal financial situation had remained the same or gotten worse over the past two years.
  • In August 2018, survey data published by the Associated Press confirmed that the law failed to deliver as a “middle-class miracle” and will not be the “rocket fuel” for our country’s economy that the Trump promised.
  • In August, 2018, analysis from the Urban Institute showed that wages have remained stagnant and that more than 40 percent of Americans continue to struggle to meet basic needs.
  • An exit poll conducted by several news outlets showed that just 28 percent said the GOP tax law had helped them as the law phased in.
  • Republicans also claimed that companies would use billions in tax savings to create new jobs, but dozens of multinational companies like AT&T have announced massive layoffs since the tax law passed. These same corporations used their tax cuts to buyback nearly $1 trillion in stock to enrich shareholders instead of investing in employees.

Put simply: the American people aren’t seeing the benefits Republicans promised.

Progressives Energy Beat Republicans’ Campaign of Misinformation

After forcing their tax law through Congress, Republicans and their wealthy donors pledged to aggressively campaign in the midterm elections on their tax cuts. In fact, special interest groups and Republican donors spent more than $100 million campaigning for the tax law, attempting to make it palatable for the public.

To combat the false narrative being pushed by the GOP, the Not One Penny coalition was formed by Tax March and over 70 organizations, including Americans for Tax Fairness, CAP Action, Indivisible, MoveOn, and numerous others. Through a massive network of activists, advocates, and organizers, the coalition fought back against the GOP’s agenda of giving tax breaks to millionaires, billionaires and wealthy organizations at the expense of everyone else.

Republican donors continued to spend hundreds of millions throughout this cycle to sell this tax disaster, including the Chamber of CommerceCongressional Leadership Fund, and National Republican Congressional Committee. But it seems their money was wasted. Despite the flood of campaign cash from Republican groups, it couldn’t match the public’s fierce opposition to this law.

And wasn’t just House Leader Nancy Pelosi or Democrats in Congress talking about the GOP’s tax law: even the Nuns on the Bus were talking about the harmful impacts of this tax law.

It’s simple: progressives’ vigorous opposition to the law and voters’ concern about how it impacts their families rendered Republicans’ campaign of disinformation as ineffective as, well, their tax law.

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