President Donald Trump's Treasury Department released its long-awaited analysis (pdf) of the GOP tax plan on Monday, and experts are aghast. Promised "full transparency" and a comprehensive explanation of how the legislation would meet its lofty goals, the public instead got one page of "pure propaganda" that makes fantastical projections in the service of bolstering Trump administration talking points.
While the report attempts to validate Treasury Secretary Steve Mnuchin's oft-repeated claim that the GOP tax bill would more than pay for itself through surging economic growth, it only does so by assuming legislative victories down the road.
In addition to the economic growth the department expects from corporate tax cuts, the Treasury report asserts that a full 50 percent of projected growth will come "from a combination of regulatory reform, infrastructure development, and welfare reform"—policy initiatives that have not even been fully proposed yet, let alone enacted. In short, the tax bill will pay for itself, analysts noted, but only if a bunch of "unrelated imaginary legislation" is piled on top of it.
Jim Tankersley, economics reporter at the New York Times, likened the wild assumptions that form the foundation of the Treasury Department's report to "an old joke about economists debating how to get off a desert island."
"Step one, they agree, is 'assume a boat,'" Tankersley writes. "The Treasury Department just assumed a boat."
Other critics of the plan skipped over the jokes and went straight to laughter. When asked by a reporter for his reaction to the one-page "study"—released just two weeks after a whistleblower said the promised "comprehensive analysis" did not actually exist—all University of Chicago economics professor Austan Goolsbee could muster was: "Hahahahahahaha."
Tax March, a coalition of advocacy groups working to stop the GOP tax bill from becoming law, argued on Twitter that Treasury's report shows "the bill would be great for the economy...in a world where unicorns exist, pigs fly, and Trump has released his tax returns."
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Ridicule aside, tax experts expressed genuine bafflement—though not exactly surprise—that the Treasury Department could arrive at conclusions that departed so drastically from those of independent analysts.
For instance, the Joint Committee on Taxation—Congress's official "scorekeeper"—estimated that the Senate version of the GOP tax bill would boost economic growth by 0.8 percent after ten years. By contrast, the Treasury report projects economic growth of 0.7 percent per year—which, after ten years, would equal seven percent GDP growth.
The Treasury Department only could have produced such results by working backward from its own assumptions, some analysts concluded.
What's amazing is that the Senate plan produces EXACTLY as much growth as the tax plan in President Trump's budget, despite having a 5% higher corporate rate, a 3.5% higher individual rate, a 15% higher top pass-through rate, and $1.5 trillion more of borrowing. https://t.co/vBohIU4qxH
— Marc Goldwein (@MarcGoldwein) December 11, 2017
The willingness of Trump administration officials to lie about key aspects of their agenda is unlike anything I've ever seen before. https://t.co/8LhLClaTMp
— Robert Reich (@RBReich) December 11, 2017
Denouncing the Treasury report as a "ridiculous piece of paper," Seth Hanlon, senior fellow at the Center for American Progress, concluded: "Do they think we—members of Congress, analysts, reporters, the American people—are that stupid?