Widening the Wealth Gap

   Unemployment is down, output is up, and consumer spending is rising as people become more confident in their economic health.
   Meanwhile, the administration issued a one-page outline of its proposed tax reform plan, which analysts said would give a major tax break to the top 1 percent of American households but much less, if any, to lower and middle income workers.
   Commerce Secretary Wilbur Ross, however, praised the plan as a way to "put more money in every working family's pocket, bring back cash that is trapped overseas," as well as "unshackle American businesses, which are hobbled by an oppressive tax rate that is the highest in the developed world."
   Another analysis documented the results of previous corporate tax breaks and concluded that they did not, as proponents claimed, lead to more jobs. Instead, it led to increased stock prices, more profit to the company and higher salaries to senior executives.
   Moreover, experts disputed the notion that profits are "trapped overseas," calling the delay in bringing back the cash an accounting gimmick that enables firms to avoid taxes even as they are able to use the money as guarantees for loans, the interest on which is deductible.
   Generally, the American economy continued its recovery in the second quarter, as output rose at an annual rate of 3.0 percent, up from 1.2 percent in the first quarter, but still shy of the president's announced goal of a 4 percent growth rate.
   Complicating this otherwise rosy picture is the storm disaster in Texas, where many of the nation's oil resources are located. Offshore drilling rigs have shut down, as well as refineries on the mainland. Already, gasoline prices are rising as supplies are suddenly reduced because of the storm damage and facility shutdown.
   The result could quickly impact production and boost prices nationwide on a wide variety of products and services.
   Separately, the Labor Department said unemployment rates were lower in July in 340 of the 388 metro areas around the U.S.  The agency said 31 regions had jobless rates of less than 3 percent, only three had rates of 10 percent or more.
   So while things look good for now, the proposed tax reform plan may well widen the wealth gap between the many working households and favored few in the president's crony corner.