A failure to pass comprehensive tax reform legislation could have dire societal consequences, FreedomWorks President Adam Brandon warned during a conference call Friday.
A comprehensive tax code overhaul that goes beyond simple rate cuts will be necessary to close the growing income gap and diminish the demographic imbalance that is rapidly driving entitlement programs toward insolvency, according to Brandon.
“We all have bathed in the data on what has happened in productivity and the demographic entitlement crisis. If you really care about society this rewrite of the tax code must grow the economy, must change labor participation and productivity so we don’t crash into demographic crisis,” Brandon told reporters Friday.
Brandon stressed the importance of comprehensive tax reform in addressing the impending demographic crisis, in which entitlement programs like social security will be thrust into insolvency as baby boomers retire, leaving too few working age Americans to subsidize the programs.
As of 2017, 12 percent of the U.S. population is 65 or older, and the number is expected to rise to 23 percent by 2080. During the same period, the percentage of working age Americans will fall from 60 percent to 54 percent, according to the most recent projections by the Social Security Policy Office.
Rep. David Schweikert of Arizona, who serves on the House Committee of Ways and Means, suggested that economic growth will likely serve as the primary means to overcome this impending crisis.
“As boomers retire we hit an entitlement wall fast,” Schweikert said. “A unified theory of economic growth is the first cornerstone of surviving the demographic crisis.”
Trump campaign economic advisor Stephen Moore emphasized the importance of reaching at least 3 percent economic growth, a figure not seen in a decade, as the primary factor in attenuating the demographic crisis and the societal rift created by widening income inequality.
“Another decade of 1 to 2 percent growth means we’re not America anymore,” Moore told reporters.
“The tax code is the swamp,” Moore added. “I used to tell that to President Trump all the time.”
Moore argued that a failure to pass tax reform could mean “the end of the GOP as we know it,” as it would represent a failure to respond immediately to the economic anxieties expressed by middle America during the 2016 election season.
“Republicans will be making a catastrophic mistake if they don’t get [tax reform] done this year. If you want to get the kind of injection of growth before 2018 midterms you can’t wait until spring 2018,” he said.
In addition to the political pressure from middle America, where wages and standards of living have stagnated over the past decade, there will likely be an economic cost should Republicans return home in December without a tax overhaul in the win column.
“There’s already been a boost in growth in anticipation of this tax cut. If they don’t get it done this year you’re going to see a crisis in confidence and maybe even a sell off in the stock market,” Moore said.
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