Our tax system is in need of reform. Wages have not risen meaningfully in decades. The unemployment rate is low, but it masks many people who have given up on working and trying to find work. Corporations have huge cash piles that they are parking overseas and not investing.
The current tax bill in Congress does not address these problems. The largest corporations are already making use of our tax code to pay tax rates in the single digits. These companies are not suddenly going to decide to give their workers raises or open more headcount. Wages rise when companies have to pay more to fill a job or retain existing workers. As long as workers accept job offers for a certain wage companies will continue to pay that wage and not more. Companies will hire more when they see opportunity to make more money if only they had more workers.
If our politicians are going to tackle the challenge of tax reform they should put forth policies that will benefit those who actually need it. The Earned Income Tax Credit has been a successful program boosting wages and helping to raise people out of poverty. There has been bipartisan support for expanding it for decades, but there are no changes as part of the current bill. The Child Tax Credit, another credit very important to working families, was expanded somewhat. The maximum value was raised, but it also raised the income threshold. According to the Center on Budget and Policy Priorities, a single working mom with two kids making $14,500 a year would see an additional $75 while a married couple with two kids making $500,000 a year would see an additional $4,000.
We should not accept the current tax reform bill. We need those who can most afford it to pay their fair share. We need to stop the loopholes that allow large corporations to ship their money overseas to avoid taxes. We need to provide relief to those that actually need relief.