If you are looking for a pure example of demagoguery, look no further than the debate over the tax bill.

Demagoguery is a way to manipulate people into seeing things your way. It doesn’t rely on reason. It doesn’t rely on facts. It doesn’t even rely on doing the right thing.

You basically say something flashy and exaggerate in the hopes that people will believe you, whether what you’re saying is true or not.

Politicians do it all the time, of course, but the recent tax debate is rife with it.

Let’s start with the Republicans. They have control of the White House, the U.S. Senate and House of Representatives, so they desperately want to pass this tax bill.

But they’re supposed to be conservatives and they’ve written a tax bill that adds at least a half trillion dollars – and maybe as much as $1.4 trillion – to the deficit over the next 10 years.





That’s not very conservative of them, so they have to somehow rationalize their position.

To do this, they claim studies showing rising deficits are flawed. They say tax cuts cause economic growth and the growth in the economy will pay for the tax cuts. They further say that the studies don’t take that into account.

That’s bogus.

Economists have calculated estimates both with and without factoring in economic growth caused by the tax cuts.

But even when factoring in large growth effects, the studies show the tax bill will not pay for itself.

The conservative Tax Foundation study, which factored in the largest amount of growth, still came up a half trillion short. Other studies using less aggressive growth models showed the deficit as high as $1.5 trillion.

So when Republicans say the tax bill will pay for itself, that’s simply not true. They know that. It’s demagoguery.

Meanwhile, this is a big talking point for Democrats. They’re banging away at the Republicans for increasing the deficit.

Never mind that when Democrats were passing Obamacare in 2009 they were faced with increasing deficits – coincidentally about the same $1.5 trillion over 10 years.

Remember what they told us Obamacare would pay for itself over time by boosting the economy with lower health care costs and health insurance premiums?

Yeah, well, none of that was true either.

One thing is clear: Politicians in both parties are equal-opportunity demagogues.

But back to the tax bill.

While Republicans are fibbing about how the tax bill will pay for itself, Democrats are fibbing about who benefits from it.

You’ve heard it over and over, right? Only rich people get a tax break. The tax bill is a sop to the wealthy at the expense of the middle class.

Well – not shockingly – that’s simply not true.

It’s a complex bill, but according to an analysis by the Washington Post, here’s a breakdown of the percentage of taxpayers in each tax bracket who would receive a tax cut or a tax hike:

Income    Cut    Hike

$0-$25,400    52.8    1.5

$25K to $49K    85.4    5.1

$49K to &87K    87.9    10.8

$87K to $150K    83.6    16.0

$150K to $217K    82.1    17.7

$217K to $308K    79.6    20.4

$308K to $746K    92.9    7.1

Over $746K    86.0    14.0

All taxpayers    76.3    8.5

If the percentage doesn’t add up to 100, it means the remaining peoples’ taxes are unchanged.

So it’s clear to see that the vast majority of taxpayers in all income brackets will realize a tax break – not just wealthy people.

And when one considers that the standard deduction grows from $6,500 to $12,000 for individuals and from $13,000 to $24,000 for married couples, it would seem middle income taxpayers would fare well.

Seems to me the ability to deduct an additional $12,000 of income would be a lot more meaningful to a married couple making $50,000 than it would to a married couple making $500,000.

In addition, the child tax credit increases from $1,000 to $1,600. Again, seemingly this would mean more to people with more modest incomes.

There are changes in deductions as well, but most of those are aimed at taxpayers who itemize deductions.

According to the most recent data available from the IRS, 30.1 percent of households chose to itemize deductions, 68.5 percent took the standard deduction and 1.6 percent had zero or negative adjusted gross income and couldn’t take any deductions.

The bill would cap the amount of property taxes you could deduct at $10,000. What type of taxpayer itemizes and pays more than $10,000 in property taxes? According to IRS data, that taxpayer typically makes more than $75,000 per year.

The mortgage deduction is limited to the interest on $500,000 in the House bill and $1 million in the Senate bill. The only way you lose out there is if you live in a house worth more than that. And you still get to deduct interest paid on the first $500K or $1M.

One of my co-workers was concerned about losing the ability to write off his student loan interest. You can do that without itemizing and that will be eliminated.

But the average amount written off by people claiming a student loan exemption is $202. I think I would trade a $5,500 increase in my standard deduction for a $202 student loan interest deduction, wouldn’t you?

I guess my take on the whole tax mess is that anytime legislation like this is written, there are winners and losers. And there also is significant and tawdry deal making where certain interest groups write special perks into the bill.

And I suppose one could argue that lowering the corporate tax rate from 35 percent to 20 or 22 percent could be characterized as a sop to the rich. The hope, of course, is that this would grow the economy.

Will it? I don’t know. But I am fairly confident it wouldn’t hurt the economy.

I am not a fan of adding to the deficit either, but I tend to look at these things differently than politicians. Politicians talk about deficits in terms of a revenue problem. I see deficits as a spending problem.

Deficits are not caused by the people being taxed too little.

Deficits are caused by the government spending too much.

Unfortunately, politicians are unable to make that distinction. They’re also unable to take the actions necessary to address the deficit problem.