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I can’t think of a better person to help us make sense of how Trump and the Republican Congress are fueling the oligarchy than Elizabeth Pancotti, managing director of policy and advocacy at Groundwork Collaborative, an economics thinktank that seeks to break up concentrations of private power and deliver true opportunity and prosperity for all. Pancotti advised Senator Bernie Sanders on economic policy and has researched economics at the Roosevelt Institute, Employ America, and the National Bureau of Economic Research.
We talked about how Trump’s first term helped launch the current administration’s massive handouts to corporations and billionaires, how Republican policy helps companies price gouge, and what initiatives we can all support to make life more affordable for more people.
Winter: How did Trump’s first administration set us up for what we’re seeing now, particularly the brazen giveaways to the rich?
Pancotti: It’s worth going back to Trump’s first term and his hallmark legislative achievement, the Tax Cuts and Jobs Act (TCJA) [ [link removed] ]. There have been a number of tax changes throughout the last 45 years, largely tilted towards the wealthy, either through corporate tax rate cuts or individual income tax cuts. The Tax Cuts and Jobs Act really blew it all open. It included a 40% cut to the top corporate tax rate, changing the top rate from 35% to a flat 21%.
This giant corporate tax cut gave companies a lot more reward for boosting their profits, which led to more price gouging. It’s much more fun to price gouge consumers to increase your profits when you pay less taxes on whatever you make.
The corporate tax cut went into effect in 2018 and then two years later the Covid 19 pandemic hit. Our research shows that companies then had an excuse to raise prices beyond what was fair. Remember, there were higher prices for essentials like toilet paper, toothpaste, Covid tests– overt price gouging in response to an emergency. Then, there was the supply chain crisis and companies took advantage of consumers being less wary of rising prices.
At Groundwork Collaborative, we wrote a report [ [link removed] ]where we found that since Trump’s first tax giveaway was enacted, 11 companies have raked in nearly $500 billion in profits and enriched their shareholders by nearly $500 billion while paying just $140 billion in federal income taxes. Compared to before the TCJA was passed, their profits had more than doubled while their effective tax rate fell by about 40%. So, Trump gave these companies a massive tax break.
The additional profits mostly lined the pockets of executives and shareholders. That’s not shocking, but when we look at those years in particular, we see that the first Trump administration allowed companies to keep a lot more from their profiteering.
Winter: The Republican megabill passed this year has so much in it. What do you think we should pay most attention to about the legislation?
Pancotti: This bill raises costs for everyday Americans [ [link removed] ] while bestowing more tax giveaways to wealthy donors and corporations. Between the healthcare costs and Trump tariffs, everyday people are much, much, much worse off. This bill is just completely skewed to the wealthy. It’s very clear who Trump and congressional Republicans were working for as they passed this bill. And this is happening when the costs of living are already too high, and families are struggling to put groceries on the table.
Millions of families will lose some or all of their food assistance, and the bill also raises costs for student loan borrowers and for every American who pays a utility bill. All of these price hikes on health care, groceries, student loans, energy, not to mention the tariffs, which are a whole other issue, are really all in service of Republicans giving even more tax giveaways to their wealthy donors and corporations.
This bill includes the largest ever cuts to Medicaid and changes to the Affordable Care Act, which will mean that roughly 15 million Americans [ [link removed] ] will lose their health insurance, and premiums will skyrocket for the people who are able to keep their health insurance. Rural hospitals across the country will close. Everything in the bill is really bad, but the cumulative effects of the healthcare costs is the thing that has been keeping me up at night.
Winter: End Citizens United is an anti-corruption organization. Can you tell me how you view all of this through the lens of corruption?
Pancotti: There are so many instances but the one that I want to focus on is that buried in the Republican bill is a reference to a single federal contract number, a $325 million contract [ [link removed] ]that the federal government has with Elon Musk’s SpaceX. I asked the Congressional Research Service, I poured over other legislation to try to find another example of a specific contract being buried in legislation like this, and I couldn’t find another example. It’s not an appropriation line for NASA, for the Department of Defense. It’s a very specific contract to SpaceX when Elon Musk was, at the time, a presidential appointee who was working very closely with Republican lawmakers and with the president. It’s very tough to believe that a request wasn’t made and given.
At the same time, Republican lawmakers understand how unpopular it is to cut programs like Medicaid and SNAP food stamps. There were members of their caucus that said, “Look, you want to do additional tax cuts for the wealthy, you have to find offsets in other places.” It’s not that they didn’t know what would happen. The Congressional Budget Office told them that they would kick millions of people off their health insurance. And they looked their constituents dead in the eyes and said, “I care more about giving a tax cut to this billionaire donor that gives to my campaign than you accessing your insulin or cancer treatment.” And, to me, that shows you the level of corruption.
Winter: What are your thoughts about what can be done? And do you see an avenue for anyone making those changes?
Pancotti: There are bright spots. New Mexico recently enacted a public child care program [ [link removed] ] to bring down the cost of child care. I think that’s a really excellent program. It’s one that can be enacted, at the local, state, or federal levels. And I’m really happy to see it pursued at the state level.
You know, American consumers are not stupid. They are very aware. They can see that Kraft Heinz executives are flying around on their private jets while they have to pay more for ketchup. We’ve seen it can be very powerful when elected officials call out corporate price gouging and call out corporate profiteering when a company is making an extra buck at the expense of American consumers.
We’ve found a number of instances where it’s very clear that companies are charging well above their input prices. [ [link removed] ] One of my favorite examples is washer and dryers. In the wake of Trump’s 2017 tariffs, washing machines were tariffed, but dryers were not. But you saw the same percent of price increases on dryers as on washing machines. If you raise the price of the washer to match the tariff, fine, you’re passing that cost on to consumers. That is understandable. But dryers were not tariffed, and the same price increase was passed on to consumers. That’s a form of profiteering that I think elected officials should call out. We’ve seen a small number of elected officials do this, and it’s really powerful when they take on corporate greed and show that they’re standing up for American consumers and families.
At Groundwork Collaborative, we’ve put out a report [ [link removed] ] saying that we should have street pricing, which guarantees that you pay the same price for something inside the gate as outside. I don’t know if you’ve traveled in an airport recently, but I just paid $7 for a bottle of water, and at Nationals games here in DC, a beer will run you $17. It’s bananas.
This may seem trivial, but it’s actually a really big issue for families. It’s one thing to get by, to put groceries on the table, and it’s another to get ahead and have enough money to take your kids to a baseball game, to have some breathing room. At every turn, Ticketmaster or billionaire sports team owners or airport vendors are raising prices. Street pricing policies are popular among Republican voters, so this can be a bipartisan issue.
Winter: With all these terrible things happening on the federal level, how are you coping?
Pancotti: There are pockets across the country where we’re seeing gains in progressive policy. This four-year period (during this administration) is interesting because it gives us a lot of opportunities to build proof of concept at the state and local level. Can we provide public childcare? Can we build municipal grocery stores? Can we experiment with really progressive policies that make life more affordable for working families? Can we demonstrate that these ideas work and are feasible and that people like them? So that when we’re able to make change at the federal level, we can say, “You know, we tried this in three places, and it worked, and we can learn from that experience and scale it to the federal level.”
There are a number of things that states are doing right now to that end. Some states are pursuing, for example, bans on surveillance pricing, which is when companies are using your data to charge you a customized price. Creating proof of concept for those things so we can try them at school is something that I hold on to, something that gives me hope.

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