Commentary

Ron Johnson’s tax rebellion

Pushing austerity for the majority while reaping the benefits of his own tax loophole

April 14, 2022 6:10 am
Sen. Ron Johnson via official Facebook page

Sen. Ron Johnson via official Facebook page

On tax day this year, wouldn’t you like to be Sen. Ron Johnson? 

Wisconsin’s senior U.S. senator paid only $2,015 in state income tax in 2017, despite earning more than $450,000 that year. Milwaukee Journal Sentinel columnist Dan Bice, who first reported on Johnson’s teeny-weeny tax bill, pointed out that the multimillonaire’s 2017 Wisconsin tax payment was two dollars less than what a married couple filing jointly paid on a taxable income of $40,000. 

Johnson also recently confirmed that he personally benefited from the change in the tax code that he pushed through in 2017. Johnson cast the deciding vote for President Donald Trump’s tax code rewrite giving corporations tax cuts worth $1.4 billion — but only after he arm-twisted Trump and Congress into including special benefits for so-called “pass-through” corporations — companies like his own PACUR plastics firm — whose profits are distributed to their owners. 

A few months later, Johnson began the process of selling his company, reaping the benefits of the tax law change, which increased the value of pass-through companies and made him more money on the sale.

Johnson won’t say how much money Trump’s “big, beautiful tax cut,” was worth to him personally, but he spins his work on the tax bill as some sort of populist crusade, claiming that the tax break was good for “90% of small businesses.” That might be true of the general, across-the-board corporate tax cuts contained in the massive piece of legislation, but when it comes to the pass-through clause Johnson personally shoehorned in, an analysis by Pro Publica of confidential tax records “reveal[s] that Johnson’s last-minute maneuver benefited two families more than almost any others in the country — both worth billions and both among the senator’s biggest donors.” Those two families are Liz and Dick Uihlien of Pleasant Prairie and Beloit billionaire Diane Hendricks, who donated a combined $20 million to groups backing Johnson’s 2016 re-election campaign. Between them, according to Pro Publica, they netted $215 million in deductions in 2018 alone thanks to Johnson’s tax stand.

Johnson makes no bones about whose interests he represents in the U.S. Senate. He voted against federal pandemic relief, wrote a letter asking Gov. Tony Evers to cut unemployment benefits on the grounds they make people too lazy to work, embraced outsourcing of good, union jobs from his hometown in Oshkosh —  saying “It’s not like we don’t have enough jobs here in Wisconsin” — and opposed the 2021 child tax credit for couples who made $150,000 or less and which the Center on Budget and Policy Priorities estimated would benefit 1.2 million children in Wisconsin. “In general,” Johnson explained in relation to anti-child tax credit position, “I don’t like to use the tax code for either economic or social engineering.”

But Johnson is willing to do plenty of reverse engineering when it comes to lightening the tax burden on the rich and increasing taxes on the less wealthy. In a Fox News interview he took a stand against progressive taxation, calling tax brackets that allow people with less money to pay less in taxes “absurd.” He endorsed “most of” a controversial 11-point plan by Rick Scott, chair of the National Republican Senatorial Committee, that would raise taxes on the bottom half of Americans and open the door for cuts in Social Security and Medicare, calling it “a positive thing.” The poorest one-fifth of Americans would pay 34% of the total tax increase under the proposal, through an average tax hike of about $1,000, according to an analysis by the Institute on Taxation and Economic Policy, which also estimates that 32% of Wisconsinites would see their taxes go up under the proposal.

These ideas are so bad for the majority of Wisconsinites, it’s hard to see how Johnson can run on them. And, in fact, raising taxes on the poor and middle class is not the centerpiece of his campaign. This week Johnson released an ad with testimony from a COVID-19 patient who says he was close to death and only access to an alternative remedy not approved by the FDA saved his life. The ad touts a bill Johnson promoted that allows terminal patients to use drugs that haven’t been approved.

Off-label drug use is standard practice and speeding up the process for experimental drug use for terminal patients was the centerpiece of the early movement to force action on AIDS. But Johnson’s advocacy for unproven COVID remedies, one of his proudest achievements in the U.S. Senate, is an embarrassment. 

Like a peddler pushing quack medicine he has aggressively promoted the horse dewormer Ivermectin,  prompting the FDA to launch a public information campaign urging people to stop trying to self-treat their COVID symptoms with veterinary medicine. And Johnson has continued to go to great lengths to undermine confidence in doctors and scientists in the midst of a public health crisis.

His public promotion of wild theories, undermining trust in physicians, has some very negative real-world consequences. Just ask hospital staff in Madison who have had to treat the flood of unvaccinated COVID patients from all over the state. These patients and their families, bolstered by internet conspiracies, have become hostile and confrontational, demanding remedies they’ve read about online that are entirely inappropriate, rejecting appropriate medicine, accusing doctors of withholding life-saving medication and even of trying to do their patients harm.

Johnson’s press conference featuring people allegedly harmed by the COVID vaccine during the height of the pandemic was the opposite of a public service announcement. But then, Johnson’s whole record shows that he’s the opposite of a public servant. He’s a public official who has used his office to serve himself. 

Going after the wingnut aspect of Johnson’s record — going back to his interrogation of the MIT nuclear physicist who served as President Barack Obama’s Energy Secretary, Ernest Moniz, on internet conspiracy theories about electromagnetic pulse weaponry — is like shooting fish in a barrel. But none of Johnson’s would-be Democratic opponents appears very interested in pursuing that line of attack. 

Instead, they are emphasizing how out of touch Johnson is – a multimillionaire who complains that he has “underperformed” by merely doubling his net worth during his time in the Senate. 

Johnson, an advocate of trickle-down economics, responded to that criticism last Friday in Medford, Wisconsin, by saying, “Now, did my business benefit? Sure. Did some of my donors’ businesses? Sure. When you give tax relief to everybody, everybody benefits. 

 But serious analysis of the 2017 tax cut shows just the opposite.

As Chye-Ching Huang of the Center for Budget and Policy Priorities explained  in February 2019 testimony to Congress, the 2017 tax law Johnson helped craft exacerbated inequality, weakened revenue and encouraged “rampant tax avoidance and gaming.”

It also, contrary to the fiscally conservative posturing of Johnson and his fellow Republicans, blew a nearly $2 trillion hole in the deficit. Their answer is to raise taxes on people who can afford it least, while proposing to cut essential services for most people.

No wonder Johnson would rather sell you snake oil than talk about his most significant legislative achievement — making the rich more comfortable and sticking it to workers by making the tax code less fair.

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Ruth Conniff
Ruth Conniff

Ruth Conniff is Editor-in-chief of the Wisconsin Examiner. She formerly served as Editor-in-chief of The Progressive Magazine where she worked for many years from both Madison and Washington, DC. Shortly after Donald Trump took office she moved with her family to Oaxaca, Mexico, and covered U.S./Mexico relations, the migrant caravan, and Mexico’s efforts to grapple with Trump. Conniff is a frequent guest on MSNBC and has appeared on Good Morning America, Democracy Now!, Wisconsin Public Radio, CNN, Fox News and many other radio and television outlets. She has also written for The Nation, The New York Times, The Washington Post, and The Los Angeles Times, among other publications. She graduated from Yale University in 1990, where she ran track and edited the campus magazine The New Journal. She lives in Madison, Wisconsin with her husband and three daughters.

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