00:03Thank you, Mr. Chairman, and to the ranking member.
00:08Mr. Chairman, I want to start by thanking you for hosting this hearing.
00:12I think your cause is right.
00:15I think getting the committee out of Washington and getting directly to the American people to hear about this bill is the right approach.
00:26Why?
00:26Why? Because the more people hear about it, the more they don't like it.
00:32Two to one.
00:34They just don't like it.
00:35And the more that we can talk to direct individuals, whether it's in places like Las Vegas or here, we walk away understanding who this bill benefits and who it leaves behind.
00:50Professor, I understand that in your testimony, you argued that investment-driven growth translates into wage gains.
00:59But I want to correct the record from information that was presented by the chairman at yesterday's hearing.
01:03According to researchers from UC Berkeley and JCT economists, using a comprehensive analysis of W-2 earnings, they found that after the TCJA, wage increases flowed almost entirely to the top 10%.
01:19Worse, there were virtually no impacts for the bottom 90%.
01:23So while some businesses may have given temporary bonuses, the fact is that the broader economy did not see wage increases from tax cuts to megacorporations.
01:36That seems to be the playbook, though.
01:39Temporary pennies to the working people, permanent relief for billionaires and megacorporations.
01:46And research by JCT and the Federal Reserve found that 17% of the corporate tax benefits went to foreign investors and owners.
01:56The last tax law gave permanent relief to corporations and scraps to workers.
02:02And this new law doubles down on that same imbalance with permanent relief for billionaires, but only temporary provisions for workers.
02:12So, Professor, how can you square this up?
02:16And won't this just deepen income inequality?
02:21Thank you for the question, Congressman Horsford.
02:23Well, that study has a critical flaw in it, and that flaw relates to the methodology of the study, where they compare C-corporations and pass-through entities in the same locality and industry.
02:40And the problem, and the reason you can't do that, is because those are integrated labor markets.
02:45Those are integrated labor markets at the middle of the income distribution, at the parts of the income distribution they're looking at, but not so much at the top of the income distribution.
02:53So, thank you.
02:54So, I dismiss that funding, and I disagree with those conclusions.
02:59I appreciate the point, but the result is what I'm talking about.
03:04And I asked you specifically how this will address income inequality.
03:09And I'm reclaiming my time.
03:12I can tell you how it's going to address me.
03:13It improves.
03:14It actually is.
03:15Professor, we have a very limited amount of time, so you dominating my time doesn't allow the opportunity for your question, which I asked and you did not answer.
03:26So, now I want to talk about the fact that Mr. Estes had his R&D expensing permanency bill that I supported, and one that the chairman even worked on with the Wyden-Smith tax package.
03:43My concern is that there are severe economic and social costs in the way that some of these provisions were made permanent.
03:52The Penn-Wharton budget model finds that this law will increase the deficit by $3.2 trillion.
04:00Since I know that my Republican colleagues will ask, yes, Penn-Wharton did a dynamic score and noted slower economic growth, bringing the score to $3.6 trillion.
04:11Yale's Budget Lab projects that the bill would add $3 trillion.
04:17Even the Tax Foundation document that's cited today in your testimony agrees that this bill will push debt to GDPR's wedding-out investment.
04:27Mr. Chair, I would like to submit to the record scores from Penn-Wharton, Yale Budget Lab, and the Tax Foundation, as well as Brookings Tax Policy Center.
04:37Without objection.
04:41I want to close with the words from Ronald Reagan.
04:45And he said in 1984, quote,
04:47The most important thing the government can do is not burden the economy with excessive taxation, spending, and regulation.
04:55But when it does intervene, it must do so on the side of the working men and women of this country.
05:03Sadly, the one big, ugly bill burdens everyday Americans with higher costs, fewer protections, and a system rigged for those at the very top.
05:15It rips food from the tables of families, it threatens clean energy jobs, and it kicks millions off of their health care, all while padding the pockets of the very rich and the powerful.
05:27This isn't economic leadership.
05:29It's economic betrayal.
05:32So let's stop calling this bill beautiful, and let's call it what it really is.
05:39It's one big betrayal of the working people of America.
