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Eddie Velazquez Prism Municipal lawmakers in Washington, D.C., want to bring autonomous vehicle services to the nation’s capital, a move that ride-share drivers and other workers say would significantly inhibit their ability to provide for their families during troubling economic times. City Council is considering a bill that would allow companies such as Waymo, which operates a self-driving […]

Nearly 33 million bank accounts sit dormant — a sign that access without confidence doesn't hold.

In April, New Jersey Senator Cory Booker and Maryland Senator Chris Van Hollen separately introduced legislation that they promised would help with the affordability crisis. Booker’s bill, the Keep Your Pay Act, would erase income taxes for taxpayers who make less than $75,000; Van Hollen’s bill, which Booker has co-sponsored, would do the same but only for incomes below $46,000. The two Democrats, both of whom are rumored to be considering presidential runs, probably figured their legislation was a slam-dunk idea. After all, who doesn’t love a tax cut?But then something possibly unexpected happened: The left pushed back. “Tax cuts are a Band-Aid, not a solution,” Natasha Sarin, a professor at Yale Law School and the president of the Budget Lab at Yale, wrote in The New York Times. Kristen Crowell, the executive director of Families Over Billionaires, argued at Rolling Stone that voters in town halls across the country aren’t demanding tax cuts—they want to see taxes raised, specifically on corporations and the wealthy. The American Prospect accused the senators of playing on Republican turf. Likewise, a rebuttal in Democracy, which is edited by TNR editor Michael Tomasky, said these proposals risk “feeding into anti-tax narratives”—and if enacted, would do serious damage to the government’s revenue base, thus undermining the safety net and other progressive priorities. Jamelle Bouie, a Times opinion writer (and personal friend of this author), didn’t pull punches on his YouTube channel. “I think it’s very dumb,” he said, explaining that the financial challenges people face aren’t really caused by income taxes, and cutting them reinforces the idea that taxes are bad.And that was pretty much that. The debate was over, the verdict in: Booker’s and Van Hollen’s bills were bad as policy, and indeed bad even as messaging bills. The question is whether that overwhelming consensus augurs a new era. Are tax cuts now dead in the Democratic Party?Booker’s and Van Hollen’s legislation never stood a chance of advancing in the Republican-controlled Senate, but they’ve been positioning themselves as national leaders and surely will resurface these ideas if they decide next year to run for the party’s nomination. “I believe Democrats need big, bold ideas that really speak directly to the pain points of Americans who are feeling more and more that our party and government and government officials in general are feckless in finding real solutions that affect their lives,” Booker told me. “It’s a massive step forward to creating economic justice in our country, by unrigging the system that allows Elon Musk and Jeff Bezos to pay less than a 5 percent effective tax rate, and has teachers and firefighters and nurses paying such a much higher tax rate.”The left commentariat’s pushback to the tax-cut proposals surprised the senators and some of the groups that helped promote them—like Patriotic Millionaires, which advocates for higher taxes on the rich and helped write Van Hollen’s legislation. “As we stand here today, [the Working Americans’ Tax Cut Act] is the single most important economic idea that has been introduced in the United States Congress in 50 years, in my humble opinion,” Erica Payne, the group’s founder, told me, arguing that the bill would fix an unfair tax system by shifting the tax burden to higher incomes. “I do not understand the motivations or the intellectual labyrinth in the minds of the people who are advocating against this idea, and I find their opposition confusing at best.”One of the most common criticisms of the proposals is that income taxes aren’t why Americans are struggling. A single person with no dependents making $46,000 might pay a little over $3,000 in income taxes—and any qualifying deductions would lower that amount. Cutting that tax would only add, at most, about $250 a month to their budgets, or $115 to a biweekly paycheck. That would quickly be eaten up by the rising food and gas costs under President Trump, and absolutely swamped by big-ticket items like health care. The proposals also provide more targeted help, like expanding the child tax credit, but overall the people targeted for help in these bills don’t pay a lot of federal income taxes already, so the savings are limited.Patriotic Millionaires’ response to this criticism is that every little bit helps when families are crunched the way they are now. “It’s a significant amount of relief,” she said of Van Hollen’s bill. More important, it establishes a living wage of $46,000 in tax law, where the concept doesn’t exist now. “From a political point of view, it forces Democrats who have historically refused to raise taxes on the donor class to make a choice. Who’s going to pay, working people or the donor class? It is a very simple choice, and it is one that we need these politicians to be forced to make.”While the savings to each person are small relative to their family’s expenses, it could cost the government trillions in revenue. Booker’s bill is estimated to erase $6.4 trillion, versus $1.6 trillion for Van Hollen’s. (Payne says that Booker’s higher price tag was unfairly conflated with Van Hollen’s proposal.) Each bill proposes offsetting those losses by taxing the wealthy more. But there are numerous other proposals to tax the wealthy more, both at the state and federal level, without also cutting middle-class taxes—the goal being to create additional revenue to accomplish more, like establishing universal childcare or expanding access to health care.The bills’ proponents argue that those considerations are separate—that deciding how to spend government revenue is a topic for later, after making the tax code more fair. Van Hollen says that passing his proposal shouldn’t crowd out the potential for other solutions. “I think this is a critical piece of a tax plan that speaks to working people,” he said. “I support other sources of revenue. There are many other corporate tax loopholes that we need to close, and I’ve been pushing to do that for a very long time. But I think this is essential.… If we believe in a living wage, which I do, then if someone’s making a living wage, we should not tax it away. In other words, if someone’s making a living wage, they should be able to live on it.”His critics argue that any reduction of government revenue, even if it is replaced elsewhere, undercuts progressives’ goal of expanding government services—which will require the government to bring in more money overall than it does now. New York City Mayor Zohran Mamdani, for example, wants to tax the rich to fund universal childcare, free and faster city buses, and affordable, city-run grocery stores; that would be much harder to accomplish if he also handed out a middle-class tax cut. Nationally, if would be nigh impossible to fund Medicare for All without the same approach of taxing the rich but otherwise keeping the tax base the same.Michael Konczal, the vice president of policy and research at the Economic Security Project, said a tax cut won’t help people “with the fundamental challenges they face on affordability, which are in large part things like health care and housing, which need a much different kind of government response”—a more ambitious response, that is, like a public option for health care and public funding for childcare. The government already doesn’t have enough resources for its current programs, he said, and the idea that a well-funded government can help solve problems is a core tenet of the Democratic Party.“I don’t think we can win an argument where we’re arguing taxes are fundamentally a punishment, as opposed to the idea that these are a necessary component to make sure that we have good things in life and that we’re economically secure, and that we can fund the programs that help a market economy, make sure that people can find jobs and are taken care of with health care, and have good schools, and have safe communities, and have a secure retirement, and so forth,” he said.If you consider that Booker’s and Van Hollen’s tax-cut bills are actually messaging tests for potential 2028 campaigns, then the most convincing argument against them may be that working- and middle-class voters aren’t exactly clamoring for a tax cut. “People are deeply, deeply concerned about cost of living, but their primary understanding of cost of living is the price of consumer goods, and then kind of more expensive fixed costs like housing, like health care,” said Anat Shenker-Osorio, a progressive strategist and messaging consultant.There also isn’t much evidence that people notice tax cuts when they’re there, according to Alex Jacquez, a senior vice president at Groundwork Collaborative, a D.C.-based nonprofit think tank. “The Republican tax cuts of Bush, Trump, and Trump 2 all proved to be very unpopular, despite delivering cuts for middle-class filers,” he said. “You could argue that that is because most of the benefits went to the wealthy, but the Obama tax cuts of 2009 similarly not only didn’t move the needle—more people thought Obama raised taxes than lowered them.”Tax cuts, in other words, are far from a slam-dunk idea. The voters aren’t demanding it, and they wouldn’t even give Democrats credit if they enacted a cut. Perhaps we’re seeing, in the response to Booker’s and Van Hollen’s proposals, a turning of the page in the party toward a focus on a bigger, better government that truly delivers for working people by providing more services while also lowering costs. That’s clearly what an increasing number of Americans want, and any serious contender for the Democratic nomination for president ought to know that.

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