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Trump supporters greet tax law with shrugs and measured hope

WEST DES MOINES, Iowa — Ask someone like Sam Banks about the tax plan President Donald Trump signed into law Friday, and you hear something other than the effusive joy Republicans in Congress put on display this week.

The $1.5 trillion plan cuts taxes broadly while bestowing its richest benefits on companies and wealthy individuals. It is the first major legislative achievement for a president who rode to the White House with the full-throated backing of people like Banks who felt America’s economic policies needed a drastic overhaul.

Yet Banks, a 50-year-old farmer in sparsely populated southwestern Iowa, regards the tax plan with a blend of indifference and uncertainty tinged with hope.

“They had to do something, though it took them long enough,” Banks said of the president and the Congress his party fully controls. “It’s going to help the companies. It’s got to help me a little, I suppose.”

In pockets of the country where Trump scored big with voters last year, the response to the tax overhaul is mainly a muted one. You’ll get a few blank stares, some confusion and a bit of hedged optimism. What you won’t hear is excitement.

Nearly all taxpayers will receive an initial tax cut. But an analysis by the Tax Policy Center shows that the gains favor the wealthy. For households earning between $48,600 and $86,100, the average tax cut in 2018 will be $930. But the top 1 percent of earners — with incomes above $732,800— will enjoy an average tax cut next year exceeding $50,000.

And companies will benefit from having their top marginal tax rate slashed to 21 percent from 35 percent — a permanent reduction unlike the tax cuts for individuals and families that expire after 2025.

“This is not a bill written with the core Obama-Trump voters in mind,” said Henry Olsen, a senior fellow at the Ethics and Public Policy Center in Washington. “In the short term they get a little but not a lot.”

One thinking behind the corporate tax cuts is that they will turbo-charge business activity and that ordinary Americans will, in time, receive benefits in the form of better jobs and higher wages. Most mainstream economists, though, have expressed skepticism that workers will benefit much from lower corporate taxes.

“This is something I’m very proud of,” Trump said Friday at an informal bill signing ceremony in the Oval Office. “Great for our country, great for the American people.”

What taxpayers will receive from the tax plan depends on their personal situations. Business people like Justin Dopierala appear most likely to benefit. Dopierala, 33, who runs an investment business out of Germantown, Wisconsin, expects the changes to reduce taxes substantially on both his corporate and personal income.

“I’m sure my wife and children would love to take more family vacations,” he said.

Banks, the Iowa farmer, isn’t expecting much of a windfall. But he sees a silver lining in the doubling of the threshold for the estate tax — something of interest to family farmers. A married couple will now be able to pass an estate worth up to $22 million to heirs tax free, up from $11 million.

In Beaumont, Texas, Chip Martel, a general contractor, says the tax changes will save his small business a substantial sum and perhaps enable him to expand his workforce of nine. He rejects the complaints of Democrats and other critics that the tax overhaul was assembled hastily, without any hearings but with heavy input from lobbyists.

“I believe we’re in the process of making America great,” Martel said, echoing Trump’s campaign slogan. “We’re changing a lot of the policies that were done with Obama, and I’m not really concerned about how it was done and finding out what’s in the bill after it was passed.”

Rich George, a farmer outside Detroit who boards horses, expressed hope that the tax plan’s provisions for the wealthy will ultimately help him because they will benefit his upper-income clients. He dismisses studies that show the tax plan will swell federal deficits by more than $1 trillion over a decade, even after accounting for any additional economic growth the tax cuts help produce.

“When they talk about, ‘This is going to add trillions of dollars to the deficit,’ I know it’s not going to happen,” George said. “You’re going to give people more money. They’re going to do more business. There’s going to be more people employed. There’s going to be more commerce. Manufacturing is going to go up.”

Some Trump supporters in Iowa said that for now at least, they were choosing to focus on the bright side.

“They needed to get a legislative win,” Heather Kruse, a 34-year-old physician in an affluent Des Moines suburb, said of Republicans.

She acknowledged that the tax plan’s passage was “hastily done.”

Like many voters, Kruse said she didn’t know most of the details and was disappointed by the reports that it won’t likely help the middle class much. But Kruse said she was cautiously hopeful that the benefits of lower taxes for companies would resonate beyond corporate America.

“If that’s true that it makes us more competitive in the global market, I can see that being a positive thing,” she said,

Then there is 88-year-old Marilyn Vanderlinden, a Trump voter who sounded appalled by the tax plan.

“This just means the rich are getting richer,” said Vanderlinden, a retired nurse, who lives in the small town of Centreville on the Missouri border.

In her county, Trump won 65 percent of the vote, which included the backing of her and her son and grandson, who raise cattle. Vanderlinden said she doubts the benefits of the tax plan will reach Centreville, whose median income is only about half the state’s average.

“I voted for Trump, but I wish I could take it back,” she said. “He doesn’t listen.”