The ‘Skin in the Game’ Fallacy

A n old rule of thumb in political campaigns is, “When your opponent is self-destructing, get out of his way.” The Democrats are in full self-destruction mode. As of this writing, RealClearPolitics has the GOP with a 4.5 percentage-point lead in the generic poll, and the lead has recently been trending higher. This is consistent with a mega-wave reminiscent of the 1994 Gingrich revolution.

So it boggles the mind that Senator Rick Scott (R., Fla.), the chairman of the National Republican Senatorial Committee (NRSC), would this week put out a 100-plus-plank platform of ideas. The NRSC and Scott are quick to point out that the platform was technically released by Senator Scott’s personal campaign committee, but the NRSC chairman doesn’t have that luxury — it was universally attributed to the NRSC itself, and rightly so.

The job of the twin House and Senate GOP congressional political committees is twofold: First, recruit the best candidates for the seats that are up — candidates who can win the seat the easiest under established criteria; second, raise money by the truckload to ensure that the first commitment is accomplished. They do not have a policy role. At best, there might be a few staffers whose job it is to help individual campaigns put together a section on their campaign website detailing a school-choice plan or a pro-life stance — and even then, this is much more a political and communications exercise than a policy one.

One of the planks in this bizarre and gratuitous platform says the following: “All Americans should pay some income tax to have skin in the game, even if a small amount. Currently over half of Americans pay no income tax.”

If that sounds familiar, it’s because it’s an echo of now–Senator Mitt Romney’s assault on the 47 percent of American households with zero or less tax liability during the 2012 presidential campaign — something he regretted saying after his loss. The strong implication was that this was a big problem, and that half the country (the poorer half) deserved a tax hike for their sloth. As Josh Barro detailed on Substack, President Barack Obama seized (pounced?) upon the gaffe to accuse the Romney–Ryan ticket of being on the side of big business and the GOP donor class, and against the side of blue-collar Americans. It worked. The GOP didn’t recover from this boneheaded strategy of “tax hikes on seniors and the poor” until Trump cured them of it in 2016.

In fact, Trump cut taxes for the lower half of Americans in the Tax Cuts and Jobs Act (TCJA). He doubled the standard deduction. He doubled the child tax credit. He cut tax rates for everyone. He lowered the corporate-income-tax rate (which cuts taxes across the board, since people and not companies pay taxes). The Joint Tax Committee analysis found that the average federal tax rate (all taxes combined) for all income tiers declined under the TCJA. The share of taxes paid by millionaires actually increased.

Say what you want about him, but Donald Trump never accused a day laborer or a McDonald’s employee of not having “skin in the game” because they didn’t make enough to pay federal income taxes. More to the point, there is zero interest among Senate Republicans in reversing this tax relief, most notably including Senator Scott himself. Perhaps the political-consultant class who advised Senator Scott on this ill-advised project should have thought of that.

Strategic error aside, it simply is not true that federal-income-tax non-payers lack “skin in the game.” It was wrong when Mitt Romney said it in 2012, and it’s even more wrong when Senator Rick Scott said it this week. These households send a lot of money to the government in the form of payroll taxes, excise taxes, and the incidence of the corporate-income tax (which they “pay” in the form of lower wages and higher prices). This is to say nothing of the local property taxes on their homes, their state income and sales taxes, and so on. The fact they may not pay federal income tax in a given year is a red herring.

This “top hat and monocle” talking point also happens to undermine the GOP’s main argument against the Senator Elizabeth Warrens (D., Mass.) of the world — that large corporations such as Amazon and rich individuals like Elon Musk don’t pay taxes. “Untrue!” we retort. “They pay plenty in all types of taxes, just maybe not income tax for the year you’re cherry-picking.” Well, if that rationale is good enough for the giant corporations who clearly hate conservatives and traditional values, it should be good enough for working stiffs, too.

Who are these moochers who lack “skin in the game”? Most notable are seniors, who enjoy a large standard deduction (nearly $30,000 for a married, senior couple) and the ability to exclude up to 50 percent of their Social Security benefits. It also includes lots of pro-life families with many children, all of whom have benefited from the Tax Cuts and Jobs Act’s doubled child tax credit. Unlike in 2012, and thanks to the elite’s culture-war fixations, many working-class white and Hispanic Americans are now GOP voters. (They don’t owe income tax, either.) The suburban mothers who voted for Virginia governor Glenn Youngkin have teenage kids with summer jobs who were taken off the federal-income-tax rolls thanks to the TCJA’s $12,000 standard deduction. Incredibly, Senator Scott has targeted a huge swath of the GOP voting base as it is constituted in 2022.

A family of four with two small children paid no federal income tax in 2021 if they made $88,000 or less in adjusted gross income. About half the families of four in 2021 earned less than $88,000. Do they lack “skin in the game”? These are people who raise their kids, pay their property taxes, send in payroll taxes every other Friday, and hope there’s enough left over for a modest vacation. They get gaslit daily by big corporations, Hollywood, Big Tech, the media, and the modern Democratic Party. They don’t need to be piled on by Republican senators with better uses for their time.