Trump Should Call for More Taxes on the Rich
Donald Trump's lead in national polls is declining. The verdict from the last debate? "Trump lost." Ben Carson, forging a political identity unprecedented in American history -- soft-spoken demagogue -- last weekend outclassed Trump's nativism by asserting that a Muslim couldn't be president. Marco Rubio, a shrewd and calculating rival who previously had avoided conflict with Trump, just picked a fight, calling Trump "touchy and insecure."
Is this the beginning of the end of The Donald?
It doesn't have to be. Trump dominated the summer by commandeering the immigration debate. His words, ugly and blunt, set the terms, and the tune, to which every other candidate danced. So much so that Rubio and John Kasich each took another step to the right on immigration last week, shutting down undocumented immigrants' hopes of citizenship.
Trump is scheduled to release his tax plan Monday. If he plays it right, he can seize the tax debate just as surely as he did immigration, putting his rivals on the defensive and reclaiming his spot at the center of the Republican universe.
He can't do it, however, with another Republican rehash of supply-side tax breaks for the wealthy. Jeb Bush is offering that; so is Rubio. Throw a stone in the Republican primary and you'll hit a deficit-financed tax cut for the wealthy.
Trump has promised to cut taxes for the middle class and to hit "hedge-fund guys" for higher taxes. Meh. Bush has already vowed to eliminate the carried-interest loophole that benefits certain investment managers (while he also cut other taxes that they pay). Rubio has proposed tax credits for the nonrich.
For Trump to stand out, he'll have to do something different -- like call for a hefty tax increase on the wealthy to pay for a break for middle-income earners. He will find support.
In a 2014 Gallup poll, 45 percent of Republicans said that upper-income people pay too little in taxes. For a candidate currently attracting the support of about one-quarter of Republicans, 45 is a very attractive number. And it plays well in the state featuring the first Republican contest. A Quinnipiac poll in July found that Iowans supported raising taxes on higher income earners to reduce taxes on the middle class by 60 percent to 35 percent.
A tax plan that turns supply-side dogma on its head will induce conservative outrage, of course, and outrage is just the right fuel for Trump's brand of fire. It's the surest way to reinforce his bona fides as a populist rich guy who can't be bought himself but knows the retail price of each of his rivals. The fact that supply-side analysis of the economy has failed spectacularly for two decades straight will only strengthen Trump's hand. While Bush and others try to explain why this time is different, and plying rich people with tax cuts will really produce great things, Trump will be the guy with facts on his side for a change.
Indeed, a Trump plan to raise taxes on the wealthy would be a huge challenge for his Republican rivals. When everyone is on the same side, they all benefit from the lack of debate. With Trump taking the opposite approach, they would have to justify a huge transfer of national wealth to their largest donors, all of whom seem to be doing pretty well already.
A billionaire is the perfect pitchman for tax increases on millionaires. If he wants to reclaim control of the primary, Trump should go there. If he forces his rivals to explain why tax plans that provide a windfall to the wealthy are really, really going to work for sure this time, despite all evidence to the contrary, so much the better.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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