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Republicans Say They Delivered Tax Cuts, Democrats Say Not So Fast


President Trump is in Florida for the holiday weekend. Most members of Congress have also headed home for the holidays. Republicans say they've delivered a big Christmas gift to American workers with a $1.5 trillion tax cut. Democrats say humbug. They insist most of the savings from that bill will go to the wealthy and big corporations. NPR's Scott Horsley joins us now to unwrap this package. Scott, thanks so much for being with us.

SCOTT HORSLEY, BYLINE: Good morning, Scott.

SIMON: President Trump signed the tax bill, of course, on Friday. According to polls, though, it's still unpopular with the public. How might that change?

HORSLEY: Well, the president and his Republican allies are certainly hoping it's going to change. Trump says one reason he was eager to get this done now is so the IRS can go to work updating the tax tables that employers use to figure out how much to withhold from workers' paychecks. That should be done over the next month or so. And that's when the president thinks workers will start liking this tax bill a lot better.


PRESIDENT DONALD TRUMP: Come February, when they open their checks and they see, wow, what happened, I have a lot more money in here - I think that's really going to be something very special.

HORSLEY: Democrats aren't buying that. They note about two-thirds of the savings in this tax cut go to the top 20 percent of earners next year. That's going to be their campaign message. Now, Republicans have urged patience about those negative polls. They say, look, Ronald Reagan's tax cut in 1981 was not real popular right out of the gate. A couple things to note about that - Reagan's tax cut in '81 was about three times as big as this one. And even so, Republicans lost 27 House seats the following year.

SIMON: The president also signed a short-term spending bill to keep the government operating through mid-January. What does that do?

HORSLEY: Well, it keeps the government's lights on, but that's about it. It does provide some temporary funding for the Children's Health Insurance Program, which lapsed in the fall - enough to keep that operating through mid-March. But all the other big battles over future spending levels for the military and domestic programs, what to do about those DREAMers who came to the country illegally as children, whether and how to prop up the Obamacare markets - all those fights were simply put on hold. And Congress will have to go back at those in mid-January.

SIMON: And that tax bill passed without a single vote from the Democratic side in the House or the Senate. But the Republican Senate leader, Mitch McConnell, told NPR in an interview this week that he'd like to see more bipartisanship after everything that has been said. Is that realistic?

HORSLEY: (Laugher) It would be interesting to see. President Trump also says he would like to see some cooperation with Democrats. Although mostly he's meant by that he'd like to see Democrats supporting his policies, and if those policies involve unwinding Democratic priorities like the Affordable Care Act, that's not very likely. Infrastructure is one area where there could be some cooperation. Certainly both parties have paid lip service to wanting that. The White House has been putting a lot of focus on streamlining the permitting process for infrastructure projects. We haven't really seen either party talk about where the money is going to come from, and it's hard to do public works projects without money.

SIMON: You mentioned the Affordable Care Act, and President Trump said yesterday, to quote him, "Obamacare is over" with repeal of the tax penalty for people who don't buy health insurance. But there were big numbers this week for Obamacare sign-ups, weren't there?

HORSLEY: That's right. Nearly nine million people signed up for coverage on the Obamacare exchanges, which is almost as many as signed up last year even though the enrollment period was much shorter this time around and even though the Trump administration slashed funding for advertising and sign up assistance. So what that shows is there is still considerable demand for this insurance coverage and the subsidies even though the president continues to say the system is imploding. Now, congressional forecasters say without the tax penalty for people who don't buy insurance, some younger, healthier people will opt to stay out of the system. And that's likely to make policies more expensive for everyone else. But for the moment at least, the Obamacare markets are still alive.

SIMON: NPR's Scott Horsley, thanks so much.

HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Scott Horsley is NPR's Chief Economics Correspondent. He reports on ups and downs in the national economy as well as fault lines between booming and busting communities.