Beyer: Trump tax cuts have spurred deficits, debt, but not growth
Remember when President Trump and his crack economic team promised us GDP growth of 4, 5, 6 percent?
That was back in 2017, after growth of 1.6 percent in 2016, the last full Obama year.
Never did get there, to 4, 5, 6. Never even got to 3, as it turned out.
The best GDP growth year under Trump was 2018, which saw 2.9 percent growth. It’s back down to 2.3 percent in 2019, according to numbers released Thursday by the Bureau of Economic Analysis.
You know that already, of course, because while the stock market is at 29,000, and that seems impressive, that’s for other people.
For the rest of us, wages are flat, your purchasing power isn’t what it was.
“The Republican tax law added nearly $2 trillion to the national debt, but delivered little sustained benefit,” said Congressman Don Beyer, D-Va., the vice chair of the U.S. Congress Joint Economic Committee. “Our country faces pressing economic challenges, and instead of addressing those challenges, the president and Republicans in Congress chose to give very large tax cuts to those who didn’t need them and run up the deficit. We should have invested in roads and bridges and in education to prepare the next generation to compete in today’s global economy.”
Oh, yeah, the deficit. A Congressional Budget Office projection released this week has the federal budget deficit passing the trillion-dollar mark.
Remember when Republicans’ panties were in a bunch over Obama-era deficits were over the trillion-dollar mark?
At least that was during a recession that was thisclose to being a depression.
One thing we learned from the 1930s: you don’t prioritize fiscal austerity when the economy is in the toilet.
There’s no excuse for trillion-dollar deficits in 2020, though. The economy isn’t gang-busters, but it’s fine; we’re not at war; and it’s not like the deficits are due to a massive spike in social spending.
It’s the tax cuts that Beyer referenced that are the culprit, and they’re not spurring growth – not enough to counter Trump’s disastrous trade wars.
“While the Republican tax law did little to boost growth, the administration’s trade policies are actually slowing growth and costing consumers money. According to the Congressional Budget Office’s latest forecast, the administration’s tariffs will reduce real GDP by 0.5 percent this year and reduce average household income by nearly $1,300. It’s time for the administration to face this reality and change policy,” Beyer said.
The sum effect of the Trump era has been … meh.
“The president and his team promised that his tax cuts would lead to GDP growth of 3 to 6 percent. It’s now clear that they haven’t come close,” Beyer said. “We’ve now had three straight quarters of modest economic growth. Three straight quarters where business investment has fallen. Manufacturing has contracted for three of the last four quarters. Whatever short-term boost to the economy resulted from the tax cuts has worn off.”
Story by Chris Graham