The Republican tax bill that President Trump signed into law just before Christmas is a disaster for millennials. While the wealthy and major corporations get a massive tax cut, millennials will get saddled with a new inflation tax, trillion-dollar deficits, and higher healthcare and housing costs. If Democrats want to win back Congress and the White House, they need to talk to millennials about repealing the Republican tax bill and replacing it with programs that truly help young people get an affordable education, earn a livable wage, and save for their future.
The tax bill is a truly massive giveaway to corporations and the wealthy. next year members of the top 1% will get a cut worth $51,000 on average. Once the tax plan is fully implemented in 2027, a majority of people earning less than $93,000 will face a tax increase while most people in the top 1% get a tax cut. You read that correctly: the Trumps and other wealthy families will get a tax cut while you and your family get stuck with a higher tax bill.
Millennials will get saddled with a that grows over time. Since the 1980s tax credits and other tax benefits go up with inflation. The Republican tax bill institutes a new, skimpier inflation measure that erodes the value of tax credits. The inflation tax will be small at first but will grow and hit hardest right as millennials are trying to settle down, buy a home, and start a family. The highly regarded Penn-Wharton budget model that the inflation tax will raise $731 billion by 2040.
The tax bill undermines Obamacare and make health insurance less affordable. The nonpartisan Congressional Budget Office that the tax bill will increase premiums by 10% and leave 13 million more people without health insurance. Millennials struggling through low wages and student loan payments will be squeezed yet again to pay for higher health insurance costs.
The Republican tax bill also blows a massive hole in the deficit to pay for a corporate tax cut. The official price tag for the tax bill is $1.46 trillion over ten years but the centrist Center for a Responsible Federal Budget that the final cost of the tax bill will be well over $2 trillion after taking into account new loopholes and budget gimmicks. The Joint Committee on Taxation estimates that economic growth will make up for less than third of the deficit-busting costs of the Republican tax bill.
It is possible, however, that large deficits from the tax bill will increase interest rates and slow economic growth. High interest rates push up mortgage costs and will make owning a home less affordable at just the time when millennials are looking settle down.
Republicans in Congress are already talking about using deficit as an excuse to undermine programs like Medicare and other earned benefits. While working millennials pay for quality, universal coverage Medicare for our parents’ generation, House Speaker Paul Ryan wants to privatize the system and give us a voucher. Does that seem fair to you?
But all hope is not lost. Repealing the Trump tax cuts for the wealthy would pay for the kind of changes that will truly help millennials: , expanding the , making healthcare more affordable, and much, much more. Millennials, along with African-American voters and women, were key to electing Doug Jones as the first Democratic Senator from Alabama in 25 years. Democrats can win across the country if they run on a platform of strong, substantive proposals to help millennial voters.
Devin Gould is a second-year Master in Public Affairs student at Princeton. This past summer he was a graduate research intern at the nonpartisan Urban-Brookings Tax Policy Center.