Why Trump's Tax Plan Matters In This Northern LA House District

The latest polls show Democratic challenger Katie Hill about even with Republican incumbent Steve Knight in the race for the 25th Congressional District seat. And a five-letter word could help motivate voters on both sides: taxes.

The district, which includes Northern Los Angeles and parts of Ventura Counties, was once a bankable GOP stronghold, but its demographic makeup has been changing. Two years ago, Democratic presidential candidate Hillary Clinton won the district over Republican Donald Trump.

Now, the latest polls show Hill in a competitive race with Knight, whose vote helped push President Trump's tax plan out of the U.S. House last year. (You can see the poll results below.)

A line more than 200-people-deep snakes around the Palmdale Council Chamber ahead of a debate between Katie Hill and Rep. Steve Knight. No cameras or recordings were allowed. (Photo by Austin Cross/KPCC)

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Knight told KPCC/LAist that the 25th District has seen the benefits of the tax plan "for the last six months and we keep getting better and better news about this ... the people that say this isn't a good economy, I don't know where they're living."

Hill, his challenger, disagrees. "Yeah, I mean, we're not seeing that," she said.

Hill and some analysts contend that the tax plan could ultimately have detrimental effects on many Californians, including residents of the district.

"When you're putting us in [a] $1.5 [trillion] to $2 trillion deficit to fund these tax cuts, then we should be making sure they're making it to people who really need the help and who are the backbone of this country," she said.

Economists agree that the tax overhaul gets some credit for the country's booming economy, but wage growth hasn't kept up.

Ed McCaffery, University of Southern California tax law professor, echoes this view of the Republican tax plan, and he zeroed in on the deficit.

"When you impact the deficit, the first effect you see is interest rates go up," McCaffery said. "Of course that hurts the people, the kind of people who don't have money but need to borrow money, which [are] the kinds of people who live in the 25th District."

McCaffery points to two more ways the Republican tax plan could hit residents of the district in the wallet: the cap on state and local tax deductions means many people could wind up paying more. Statewide, the Franchise Tax Board estimates Californians will pay an extra $12 billion in taxes. If they leave California, he said, the state might have to raise taxes for everyone else.

Among voters in the district, there's a range of opinions about the effects of the tax plan. Simi Valley Republican Dean Loutman told KPCC/LAist that he sees the Trump legislation benefiting people in his community.

"Absolutely," he says. "This whole crumbs that I hear Nancy Pelosi talk about-- but yet they're so eager to take it back."

Democrat and 30-year Palmdale resident Andy Giest isn't convinced the plan is a positive, however.

"[Because] I know where all the tax benefits are going," Giest said. "They're going to the wealthy. They keep saying trickle down and we're down, and nothing's trickled to us yet."

In late September, the House voted to extend many of the tax plan's controversial cuts indefinitely. That, McCaffery says, could increase the chance of cuts to Medicare and Social Security.

The Senate is not expected to debate the extension before next month's midterm, meaning that the financial future of many in the 25th District could be in the hands of voters.

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