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Trickle down economics is when the government reduces taxes on the wealthy and businesses to benefit society long-term. Social safety is where the government spends money on keeping its citizens safe and improving their lives. I agree more with the social safety net approach as it benefits individuals and most corporations corrupted.

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I think the New Deal is better because usually when there are tax-cuts, people don’t use the excess money for savings or investments, they use it for their own greed.

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I think New Deal or the Social safety net is better economic approach than the Trickle-down. By placing heavy tax on the poor people will affect the economy negatively. Also, there is no guarantee that when you cut taxes from the rich, it will benefit the poors.

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I think that the wealthy should pay more taxes than the poor, but no one should be taxed above 50%. No one will have the motive to work as hard if their final goal leads them to have half of their money taxed by the government. 

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I think that the wealthy should pay more taxes than the poor, but no one should be taxed above 50%. No one will have the motive to work as hard if their final goal leads them to have half of their money taxed by the government. 

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I agree with Lizzy. I also think a social safety net is better, because it's very easy for corporations/the wealthy to be corrupt. It's more important to help the people who need it first.

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Adding on to Lizzy and Elka, I personally think the Social Safety Net is a better economic approach because placing heavier taxes on the poor still won’t get the economy any more money. The national debt would most likely increase if we applied reaganomics.

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I think the wealthy should just pay the taxes they pay now. I don't think they have to pay more than they currently do. they are rich because of the hard work they do, not because they are just being lay everyday (if they don't work, they don't get money). So I don't think the rich should be penalized just for being "rich". they have a reason they are rich.

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Personally, I think that the New Deal is better because even if you cut taxes it will not help the poor but rather benefit the rich people by making them richer by not having them pay a lot of taxes. n

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I think the New Deal is better because when you cut taxes from the wealthy people, it wouldn't actually help the poor. The rich people will just take all money.

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I think the wealthy should be taxed more since most of them have thousands times more money than  average americans. It isn’t fair for the middle class. With the money taxed from the rich they can help support the poor and middle class through various programs.
According to the article linked below, the top 1% of americans only pay 24.7% of federal income, thats only 5% more than the average middle class American!

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It's time for the wealthiest Americans and big corporations to pay their fair share of taxes. When they take unfair advantage of the many loopholes in the tax code the rest of us pick up the tab.

Instead of cutting education funding for our children, we should ask millionaires to pay a tax rate at least as high their secretary's.

Instead of cutting Social Security and Medicare, we should ask the wealthy to give up a few tax loopholes so that we can make sure everyone has a secure retirement.

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The federal income tax is designed to be progressive - tax rates increase in steps as income rises. For decades this helped restrain disparities in income and helped provide revenue to make public services available to all Americans. Today the system has badly eroded - many multi-millionaires and billionaires pay a lower tax rate than average American families.

Ironically, this has happened while the gap between the wealthy and everyone else has grown wider than ever. The extremely rich aren't only earning and owning more - many are also passing wealth to their heirs tax free, creating a new American aristocracy with vast fortunes.

Tax income from investments like income from work. Billionaires like Warren Buffett pay a lower tax rate than millions of Americans because federal taxes on investment income (unearned income) are lower than the taxes many Americans pay on salary and wage income (earned income). Because Buffett gets a high percentage of his total income from investments, he pays a lower income tax rate than his secretary. Currently, the top statutory tax rate on investment income is just 23.8%, but it's 43.4% on income from work. To reduce this inequity, we should raise tax rates on capital gains and dividends so they match the tax rates on salaries and wages. These loopholes lose $1.3 trillion over 10 years.

Cap tax deductions at 28% for the wealthiest Americans. The rich are able to get much bigger tax breaks for the same tax deductions taken by the middle class. For example, a wealthy family living in a McMansion gets a much bigger tax deduction on the interest on their large mortgage than a middle-class family gets on the interest on their small mortgage on a two-bedroom house. President Obama has proposed to limit the tax break on deductions that the richest 3% can take to 28 cents on the dollar. In other words, the rich would get the same tax benefit per dollar of deductions as a household in the 28% tax bracket, but not more (as they do now) at the higher 39.6% bracket. This would raise $500 billion over 10 years.

Strengthen the estate tax. Some of the ultra-rich are able to take advantage of loopholes so they pay almost nothing in inheritance taxes. Others take advantage of the fact that the exemption levels for the estate tax are very high - $5.3 million per individual ($10.6 million per couple). President Obama proposes to restore the exemptions to their 2009 levels - $3.5 million for an individual ($7 million for a couple) taxed at a 45% top rate. This and other reforms would raise $131 billion over 10 years. Only three estates for every 1,000 deaths would be affected.

Another way to ensure that large inheritances are taxed is to close the income tax loophole that lets wealthy people avoid capital gains taxes by holding their assets until they die. Their heirs then escape paying taxes on these gains. This would raise about $650 billion over 10 years. We should also end specialized trusts that allow families, such as the Waltons who own more than half of Walmart, to completely avoid paying estate and gift taxes.

Pass the Buffett Rule. The Buffett rule, inspired by billionaire Warren Buffett, would require millionaires to pay a minimum tax rate of 30%. This will guarantee that the wealthy will not pay a smaller share of their income in taxes than a middle-class family pays. It would raise $72 billionover 10 years.

Close the Wall Street carried interest loophole. Wealthy private equity managers use a loophole to pay the lower 23.8% capital gains tax rate on the compensation they receive for managing other people's money. We should close this loophole so that they pay the same rate as others at their income level who receive their compensation as salary. This would raise $17 billion over 10 years.

Eliminate the payroll tax loophole for S corporations. This loophole allows many self-employed people to use "S corporations" to avoid payroll taxes. Used by Newt Gingrich and John Edwards to avoid taxes, closing this loophole would require treating this income as salary rather than profit, making it subject to payroll taxes. This would raise $25 billion over 10 years.

Conservatives claim the wealthy are overtaxed. But the overall share of taxes paid by the top 1% and the top 5% is about their share of total income. This shows that the tax system is not progressive when it comes to the wealthy. The richest 1% pay an effective federal income tax rate of 24.7%. That is a little more than the 19.3% rate paid by someone making an average of $75,000. And 1 out of 5 millionaires pays a lower rate than someone making $50,000 to $100,000.

Conservatives claim that the estate tax is a "death tax," wrongly implying that the tax is paid when every American dies. In fact, the tax primarily is paid by estates of multi-millionaires and billionaires. The vast majority of deaths - 99.9% - do not trigger estate taxes today.

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Download this document in PDF format. Drawn from Americans for Tax Fairness' 2014 Tax Fairness Briefing Booklet.

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Fact Sheet: Taxing Wealthy Americans - Americans For Tax Fairness

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Key Facts The richest 1% of Americans own 35% of the nation's wealth. The bottom 80% own just 11% of the nation's wealth. In the 1950s and 1960s, when the economy was booming, the wealthiest Americans paid a top income tax rate of 91%. Today, the top rate is 43.4%.

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Personally, I think war is really stupid and solving disputes through aggression is never the way to go. Right now it may be necessary for the United States to spend so much on the military since they are fighting in the middle east. They may need those funds, but really I believe that peace is the best option for all countries. War should never be the answer.

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Spending money on the military as well as development of new technology is essential to keep the balance. It is always better to have precaution and be one step ahead in terms of military technology than other countries in case they attack or destroy world peace.
This has nothing to do with engaging in war btw. When the US first developed nuclear weapons, they aren't afraid to drop them on Japan because they know Japan don't have the same technology. But during the cold war, both are scared to engage war because they know very well what will happen if they start a war. Spending more in military is actually a good method to prevent people from too recklessly attacking and waging war with each other

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I think that the wealthy should be taxed more. When you look at Japan, the highest income tax rate is 45% while in America it's only 37%. So, I think that wealthy people should pay more the
n they do right currently since they have a lot of money. It also improves the wealth gap.

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I think that the wealthy should pay more taxes but the amount they are paying now is enough. They also make a lot of donations in order to reduce the amount of tax they have to pay--> I think that is good. People that have to be taxed above 50% are people that are really REALLY wealthy. These people will not ever use up their money so they should contribute more to the community.

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The New Deal will work more effectively because it won't make a difference to regulate more taxes on the poor. 

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The New Deal will work more effectively because it won't make a difference to regulate more taxes on the poor. 

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I don't know much about the military but I think spending more on it than the next 10 nations combined is a bit much. The U.S might need to spend more on the military because they are so powerful and people might want to bring them down. They are also at tensions with certain countries, so having a strong military can protect them. But again, I think spending more than the next 10 nations is too much.

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Capitalism. Democratic socialism can work well with the right people but most of the time leaders are too controlling and abusive (North Korea, China, etc.)

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I kind of disagree with Othniel. A lot of our parents in Taiwan pay at most 40% income taxes (minimum 20%) because it covers for a lot of things that we basically take for granted such as healthcare. We sacrifice a lot of our money so that we could get affordable care and protection. I also think that the amount of taxes people pay should be dependent on the amount of money they make. The more money they make, the more taxes they would have to pay.

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I think that a social safety net is a lot better way to regulate between the poor and the rich people. Cutting down taxes from rich people just sounds dumb and stupid. It just makes the rich people become more rich, while the poorer get more poor. These corporations won't even bat an eye to help the less fortunate, so I think that the New Deal is a lot better. 

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I think that a social safety net is a lot better way to regulate between the poor and the rich people. Cutting down taxes from rich people just sounds dumb and stupid. It just makes the rich people become more rich, while the poorer get more poor. These corporations won't even bat an eye to help the less fortunate, so I think that the New Deal is a lot better. 

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I think that it is okay for the US to spend a lot on the military. America has many enemies and without a strong military they might be targeted easily. If war occur and they do not have a strong military they may lose even more money because of their unreadiness.

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will work better because reagonnomics does not work as we have seen in the past... also, people will just use more of their money for themselves not to make more jobs.

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I think that it is okay for the US to spend a lot on the military because America has a lot of enemies, but because of their strong military the enemies do not attack them.

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I think that Capitalism has worked the best worldwide considering the fact that most of the countries are capitalist countries. However, within those countries, there are still socialist policies that work completely well

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Biden’s perspective: to raise corporate income tax rate, save the middle class to make it more racially inclusive. 52% of American adults live in middle-income households and our economy is dependent on the middle class. So if we were to save the middle class, we would save 52% of America

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President Joe Biden campaigned on an economic platform to shore up the middle class, extend healthcare, raise taxes on the wealthy, and invest trillions of dollars in green energy infrastructure, among other issues.

On March 11, 2021, Biden won his first major economic victory when he signed the American Rescue Plan Act of 2021 into law. It's one part of his Build Back Better Plan, which also includes the American Jobs Plan and the American Families Plan. Although neither of those passed Congress, parts of them were wrapped into the Inflation Reduction Act, passed in August 2022.

But the president and his administration are dealing with high inflation, resulting from the pandemic and the war in Ukraine. Inflation has come down from its record high in 2022 due to interest rate hikes from the Federal Reserve, but high prices for goods and services are still hurting the country. Here are the details of his policy goals.

The American Rescue Plan

President Joe Biden formally announced his $1.9 trillion COVID-19 stimulus plan on Jan. 14, 2021. On March 11, 2021, he made it a reality. Biden signed the $1.9 trillion piece of legislation passed by Congress just days before, promising $1,400 stimulus checks, extended unemployment benefits, a vaccine rollout, and more-all as part of the promises he made in Wilmington, Delaware, in January 2021.

"There is real pain overwhelming the real economy. You won't see this pain if your scorecard is how things are going on Wall Street," Biden said in his speech. He referred to what many economists are calling a K-shaped recovery, adding that "the wealth of the top 1% of the nation has grown roughly $1.5 trillion since the end of last year-four times the amount for the entire bottom 50%."

Funding the assault on the coronavirus, strengthening the social safety net for those pushed to the brink, and helping state and local governments are the main goals of the American Rescue Plan. In the first 100 days of his administration, his goal was to reopen most schools and have 100 million vaccine doses administered.

The American Rescue Plan didn't mention tax increases, which means the federal government will pay for it with debt. The president has spoken strongly against deficit worries during the pandemic, earning praise from progressives in his party, such as Sen. Bernie Sanders.

We've highlighted some of the key elements of the American Rescue Plan below.

This portion of the plan, worth $1 trillion, included $1,400 checks sent to individuals with adjusted gross incomes of less than $75,000 (if single or married filing separately), $150,000 (if married filing jointly), or $112,500 (for heads of household). These checks were meant to supplement the $600 checks that were previously mailed out.

Additional funding provided for eviction and foreclosure moratoriums expired on July 31, 2021. The plan included $21.5 billion in emergency rent, almost $10 billion in mortgage assistance, and $5 billion in emergency assistance for people experiencing homelessness.

Child care and food program funding along with an expansion of the child care tax credit for one year were also part of the program. Despite a request from Biden, automatic economic triggers were not part of the legislation nor is a plan to raise the federal minimum wage to $15 an hour.

Public Health Efforts and Reopening Schools

This section included:

A $20 billion national vaccination program

A $50 billion "massive" expansion of testing

The hiring of 100,000 more public health workers

$30 billion for the Disaster Relief Fund for personal protective equipment

$130 billion to open most schools.

The total cost? $400 billion.

Biden also issued an executive order, partnering with the Occupational Safety and Health Administration (OSHA) to issue rules to protect all workers.

Support Local Communities

This $400 billion section of the plan aimed to provide help for governments dealing with revenue shortfalls to keep front-line public workers on the job, small business grants and loans, and $20 billion for public transit agencies.

Beefing up Cybersecurity

In the wake of the SolarWinds hack, which affected federal agencies, Biden wanted $9 billion to modernize and secure federal information technology. Congress approved almost $2 billion.

Healthcare

Official data from the United States Census Bureau indicates that the uninsured rate in 2019 was 9.2% versus an uninsured rate of 8.9% in 2018. Between 2018 and 2019, the number of people without health coverage decreased in one state but increased in 19 states. Overall, the number of people with no health insurance for the entire year was lower at 8% in 2019, compared to 8.5% in 2018.

Biden railed against the Trump administration's countless attacks on the Affordable Care Act. As president, he promised to protect and build on the ACA. Although he wants to ensure healthcare is a right and not a privilege, he does not support Medicare-for-all or eliminating private insurance because it would mean getting rid of Obamacare and starting over on political negotiations. He also argued during the Oct. 15, 2019, presidential debate that Medicare-for-all would cost more than $30 trillion over 10 years.

According to Biden, his healthcare proposal will expand Obamacare so that more than 97% of Americans are insured, and will cost $750 billion over 10 years. His goal is to introduce a public health insurance option like Medicare, which will be available premium-free to individuals in states that haven't expanded Medicaid and to people making below 138% of the federal poverty level.

He also wants to eliminate the 400% federal poverty level income cap for tax credit eligibility and lower employees' maximum contribution for coverage to 8.5%. In addition to this, he promises to:

Bar healthcare providers from "surprise billing" patients with out-of-network rates

Address market concentration in the industry

Allow Medicare to negotiate lower prices with drug manufacturers

Establish an independent review board that will recommend a reasonable price for drugs with no competition

Penalize drug price increases over the inflation rate

End the tax deduction for all prescription drug ads

Support the development of generics

Restore federal funding for Planned Parenthood

On April 9, 2020, Biden promised to fight for lowering the Medicare eligibility age to 60 from 65. "It reflects the reality that, even after the current crisis ends, older Americans are likely to find it difficult to secure jobs," he said in a Medium post discussing the soaring unemployment caused by COVID-19 and measures needed to help those affected. He also said that the additional cost will be "financed out of general revenues to protect the Medicare Trust Fund."

Biden also opened up the enrollment period for HealthCare.gov from Feb. 15 to Aug. 15, 2021. Several provisions in the American Rescue Plan made it (at least temporarily) less expensive to receive health coverage through the Health Insurance Marketplace. For example, the government paid the entire COBRA premium from April 1 through Sept. 30, 2021, for people who lost a job or had their hours cut.

President Biden wants a pro-growth, progressive tax code. His plan is expected to raise nearly $4 trillion in additional revenue over a decade. According to the Tax Policy Center, "The highest-income 20% of households (who make about $170,000 or more) would bear nearly 93% of the burden of Biden's proposed tax increase, and the top 1% nearly three-quarters."

Here's a list of changes he campaigned on making:

Raise the top income tax rate back to 39.6% from 37%

Tax capital gains and dividends at ordinary rates for those with annual incomes over $1 million

Tax unrealized capital gains at death

Apply Social Security payroll tax for those earning over $400,000 a year

Close the step-up-in-basis loophole

Raise the top corporate income tax rate to 28% from 21%

Impose a 15% minimum tax on the book income of large companies (at least $100 million annual net income)

Tax profits earned from foreign subsidiaries of U.S. firms at 21%

Student Debt

During his campaign in the presidential election, President Biden wanted to make tuition free for those who earn up to $125,000 and attend two- and four-year public colleges and universities. He planned to fund this by repealing the high-income "excess business losses" tax cut in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. "That tax cut overwhelmingly benefits the richest Americans and is unnecessary for addressing the current COVID-19 economic relief efforts," he said.

He also had several other federal student debt proposals, including:

Immediately canceling a minimum of $10,000 of student debt per person

Forgiving the remainder of loans after 20 years with no tax burden

Suspending the monthly payments and interest of those earning less than $25,000 per year and capping payments at 5% of discretionary income for the rest

Additional federal loan forgiveness of up to $50,000 over five years for those who participate in public service

Making public colleges and universities free for all families whose income is below $125,000.

Biden fully endorsed and adopted Sen. Elizabeth Warren's plan to change the personal bankruptcy laws he helped shape, which makes student loans dischargeable. The proposal is to streamline and simplify the process of filing for bankruptcy to make it cheaper and more flexible.

Student Loan Forbearance and Forgiveness

In March 2020, the Department of Education paused payments for federal student loans in response to the economic fallout of the pandemic. All interest, repayment, and collections on federal student loans were suspended. The Biden administration extended the payment pause multiple times before a 2023 timeline for ending the program was announced in November 2022.

The Biden administration enacted the American Rescue Plan, which aimed to tackle challenges faced during and because of the COVID-19 pandemic. Among the highlights was a provision that makes all student loan forgiveness from Jan. 1, 2021, to Dec. 31, 2025 completely tax-free.

Biden also announced a plan in August 2022 that called for forgiving up to $20,000 in student loan debt for borrowers whose income is less than $125,000 and who were Pell Grant recipients. For those who were not Pell Grant recipients, the cancellation amount is up to $10,000.

In addition, he promised:

A new income-driven repayment plan that halves monthly payments for undergraduate loans

Fixes to the Public Service Loan Forgiveness (PSLF) program to help certain borrowers, such as government workers and those in the military, qualify more easily for loan forgiveness

To work with colleges to keep the cost of higher education down.

But federal courts issued orders blocking the student loan forgiveness plan. Consequently, as of Nov. 11, 2022, the Department of Education stopped accepting applications for student loan forgiveness.

While waiting for the court challenges to the loan forgiveness program be resolved, the department announced that the forbearance program will end on the earlier of these two dates:

1. 60 days after the department is permitted to implement Biden's loan forgiveness program or the litigation is resolved; or

2. 60 days after June 30, 2023.

Workers' Rights

Biden said he's committed to raising the federal minimum wage to $15 and eliminating "right to work" laws. He also wants to give workers more bargaining power by getting rid of "abusive" non-compete clauses, removing rules in contracts that prevent employees from discussing pay with each other, and stopping companies from classifying low-wage workers as managers to avoid paying them overtime.

He wants international trade rules that "protect our workers, safeguard the environment, uphold labor standards and middle-class wages, foster innovation, and take on big global challenges like corporate concentration, corruption, and climate change."

Made in All of America

In July 2020, Biden proposed a $700 billion plan to boost America's manufacturing and technological strength. This involved government spending of $400 billion on U.S. goods and services and a $300 billion investment in research and development (R&D) on technologies like electric vehicles, lightweight materials, 5G, and artificial intelligence (AI).

"Biden believes that American workers can out-compete anyone, but their government needs to fight for them," says his website. "Biden does not accept the defeatist view that the forces of automation and globalization render us helpless to retain well-paid union jobs and create more of them here in America. He does not buy for one second that the vitality of U.S. manufacturing is a thing of the past."

Infrastructure and Climate Change

As vice president, Biden once called New York's LaGuardia Airport "a third-world airport" in a speech about infrastructure in the U.S.

"Look, we need roads, we need waterways, we need ports to move our products," he said at Brookings, adding:

We need highways and transit to get workers to and from work. We need lightning-fast broadband to communicate. It's not a luxury. It's an absolute necessity to compete with the rest of the world. We need a massive investment in infrastructure: roads, bridges, airports, broadband. We've been lagging for too many years now, and we can afford it.

His goal was to spend $1.3 trillion on infrastructure over a decade. This plan included $50 billion in his first year in office for repairing roads, highways, and bridges, $20 billion for rural broadband infrastructure, $400 billion over 10 years for a new federal agency to conduct clean-energy research and innovation, $5 billion over five years on electric car battery technology, and $10 billion over 10 years on transit projects that serve high-poverty areas.

He was able to get a start on some of those goals with the implementation of the $1.2 billion Infrastructure Investment and Jobs Act, which provided $550 billion for rebuilding roads and bridges, improving public transit, replacing lead pipes and addressing drinking water contamination, expanding access to high-speed internet, and more. The rest of the money would come from renewed appropriations for routine federal infrastructure spending.

The president's website said he supported the idea of a Green New Deal and that he wanted to ensure the U.S. has a carbon-pollution-free power sector by 2035 and reaches net-zero emissions no later than 2050. He also promised to rejoin the Paris Agreement, which he did in January 2021.

He also wanted to establish a new Environmental and Climate Justice Division within the Justice Department. To build a 100% clean energy economy and create millions of "good union jobs," Biden's plan was to make investments in new infrastructure, public transit, clean electricity, the electric vehicle industry, buildings and housing, and agriculture.

In all, his climate plan was estimated to cost $2 trillion over his first term.

Rural America

Biden wants to help rural communities, which make up 20% of the U.S. population, by fighting for fair trade deals, investing $20 billion in rural broadband infrastructure, creating low-carbon manufacturing jobs, reinvesting in agricultural research, improving access to federal resources and funds for farming or small businesses, expanding health services and medical training programs, and providing funding in areas with persistent poverty.

The American Middle Class

Revitalizing the middle class and making it more racially inclusive was the cornerstone of Biden's campaign. "The country wasn't built by Wall Street bankers, CEOs, and hedge fund managers. It was built by the great American middle class," he said at a rally kicking off his campaign.

Although this sounds like something Sen. Bernie Sanders would say, Biden casts himself as a moderate with sensible, achievable plans rather than the leader of "a revolution" against economic inequality. "I don't think 500 billionaires are the reason why we're in trouble," he said in a speech at a Brookings Institution event in 2018. "The folks at the top aren't bad guys."

But he does believe a growing and thriving middle class, which he likes to think of more in terms of values and lifestyle rather than an income group, is important for social and political stability in the U.S. He blames the lack of opportunities and optimism in the country for "phony populism" and "a younger generation that's questioning the very essence of our capitalist system."

According to Pew Research, 52% of American adults lived in middle-income households in 2018. These are adults whose annual household income is two-thirds to double the national median after incomes have been adjusted for household size. The annual income range for a middle-class household of three in 2018 was $48,500 to $145,500.

The U.S. has a proportionally smaller middle class than many other advanced economies, and the income disparity between groups in the middle class is growing, according to Pew. Moreover, though the top 20% have fully recovered from the Great Recession, the middle class has not yet reached its previous peak in 2007, according to Brookings experts.

"Folks in the middle class are in trouble. It's not just their perception. They are in trouble," said Biden.

Who Will Benefit From Biden's Student Loan Forgiveness Plan?

How Is the Biden Administration Stimulating the Market for Electric Cars?

Are Biden's Policies Helping Medicare?

The Bottom Line

As an incoming President, Biden faced many challenges, such as the ongoing COVID pandemic, issues arising from the pandemic, and high levels of inflation, to name but a few. His economic plan has aimed to address all of these issues, as well as other areas to improve the lives of those living in the country.

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Learn about President Biden's proposals on healthcare, taxes, student debt, workers' rights, industry, infrastructure, and climate change.

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I do not think that the wealthy should be taxed more. They are making money because of their hard work and I don't think they should be punished for that. If the amount of money that the wealthy ultimately get to keep per year is equal to the amount of money that the poor keep per year that is not fair and it will just be like communism, which I am really not a fan of.

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I believe that social safety net is better not only in short term but also in the long run. Because trickle-down reduces the rich's tax in order to benefit the society in the long run, I think it wouldn't be fair for the poor and plus the social safety net is better in general.

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Lizzy, that article doesn't seem to provide the right information. According to this article, the actual income tax rate for the top 1% is 37%, still under 50%!

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There are seven tax brackets for most ordinary income: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent. The U.S. has a progressive tax system, which means that as you move up the pay scale, you also move up the tax scale.

Your tax bracket depends on your taxable income and your filing status: single, married filing jointly or qualifying widow(er), married filing separately, and head of household. The deadline to file taxes is April 15, unless that date falls on a weekend or holiday or you get an extension. However, as part of the government's relief efforts for those impacted by coronavirus, the tax-filing deadline has been extended to July 15.

2019 federal income tax brackets

How do federal tax brackets work?

Tax brackets are not as intuitive as they seem because most taxpayers have to look at more than one bracket to know their tax rate.

Let's use the tax bracket for 2019 and say your filing status is single and you earned $70,000. You would pay 10 percent on the first $9,700 of your earnings ($970); then 12 percent on the chunk of earnings from $9,701 to $39,475 ($3,573); and then 22 percent on the remaining income, up to $80,000 ($8,916).

Your total tax bill would be $13,459. Divide that by your earnings of $80,000 and you get an effective tax rate of 16.8 percent, which is lower than the 22 percent bracket you're in.

The brackets below show the tax rates for 2019 and 2020. The brackets are adjusted each year for inflation.

How to get into a lower tax bracket

There are basically two ways to get into a lower tax bracket: tax credits and tax deductions.

Tax credits are a dollar-for-dollar reduction in your income tax bill. If you have a $2,000 tax bill but are eligible for $500 in tax credits, your bill drops to $1,500.

Tax credits can save you more in taxes than deductions. There are tax credits for a variety of things. The federal government gives tax credits for the cost of buying solar panels for your house and to offset the cost of adopting a child. There are education tax credits and tax credits for the cost of child care and dependent care, to name a few. Many states also offer tax credits.

While tax credits reduce your actual tax bill, tax deductions reduce the amount of your income that is taxable. If you have enough deductions to exceed the standard deduction for your filing status, you can itemize those expenses to lower your taxable income. For example, if your medical expenses exceeded 7.5 percent of your adjusted gross income in 2019, you can claim those and lower your taxable income.

Tax brackets and the new tax law

The Tax Cuts and Jobs Act that went into effect on Jan. 1, 2018, retained seven tax brackets but lowered some of the tax rates and raised some of the income thresholds for those rates. The highest earners now pay 37 percent instead of 39.6 percent. And taxpayers can earn more before they break into the highest tax bracket.

The new law also nearly doubled the standard deductions. With much higher standard deductions, fewer people will itemize. The standard deductions for each filing status for 2019 are:

Single: $12,200

Head of household: $18,350

Married filing separately: $12,200

Married filing jointly: $24,400

Qualifying widow(er): $24,400

The Tax Cuts and Jobs Act overhauled the tax code, resulting in many changes - some that save taxpayers money, others that raise their taxes. One big change, especially for people in high-tax states, is the $10,000 cap on the amount of state and local property tax, income tax and sales tax that can be deducted. Those taxes were almost fully deductible before.

The new law also hits people with high mortgage debt a little harder. The amount of mortgage debt on which the interest is tax-deductible is reduced from $1 million to $750,000.

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There are seven tax brackets for most ordinary income: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent. The U.S. has a progressive tax system, which means that as you move up the pay scale, you also move up the tax scale.

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Social Safety Net is better. By allowing the government to have more power instead of relying on ourselves, the economy could be controlled better

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Idk if its necessary but I do believe it is wise. If they have a higher threat of a military than other countries than America will remain stronger than most other countries and will be able to most likely avoid war.

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People say the richest people are too rich, and should be taxed heavily. That is really dumb considering how most of these people did put their own effort as well as a combination of luck and determination to reach the place they did. Having tax brackets to as much as 50% tax is already absurd. Half of the money you earn is taken away. Any more tax then that will make people lose the incentive to work hard and gain money. If I say the billionaires should be taxed 99% they would still be richer than almost everyone, but would anyone want to be a billionaire if the tax is that high

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I do agree that when the income rises the tax will rise; however, the limit should be what we have now. Increasing even more taxes for the wealthy people is just unfair. Taxing above 50% is just total bs.

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I agree with Lizzy and Koki. I haven't heard much about democratic socialism, but I've heard a lot about capitalism. Since it is used in most countries and it's more well-known, I'm assuming it works better

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I think rich people should pay more taxes than they currently do in US. The top few percent rich group of people pay less than 30% which is ridiculously low compare to their incomes. Like Asian countries, they should pay about 40%.

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I think that it’s important for America to spend money on the military for safety reasons, but spending too much is also a problem. I think that we could use some of the money for something else, too.
-alice (idk why im anonymous)

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I think I disagree with everyone that said how its wise/necessary or a good idea for the US to spend more money on the military. Currently, they have already spent around 934 billion on military and is the second largest sector that the government spends money on. Although the first is social security, there are a whole lot more areas that the government could spend money on. Rather than preventing future wars, America should focus on helping their citizens right now.

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Why U.S. Military Spending Is More Than You Think It Is

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U.S. military spending is $934 billion for FY 2021 once you add components hidden in other budgets. Here’s the breakout since 2003.

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NO. I think the wealthy people shouldn't pay more taxes than they currently do because a lot of them are already paying a lot of taxes. Most rich people worked really hard to earn the money they have right now, and they shouldn't need to pay more than they are currently paying.

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I think that socialism just does not work. I think there will always be a group stronger than others and there will never be an equal state. Corruption is in human nature so I don't think we should depend on that.

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It is not necessary for the US to spend more on the military because the military is already powerful.   They shouldn't be so aggressive because that would just cause more problems. Maybe other countries would think that America is weak if they don't put more money in military, but as Annette said, the government can spend more money on other sectors, not just social security and military.

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I agree with Richard. I think no matter how much you earn, no one should be taxed above 50% because being taxed above 50% means that half of what you earned will be taken away.

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The military is used not only in War but also to solve disputes within the country.

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After a week of both peaceful protests and violent chaos in the wake of George Floyd's death, President Donald Trump announced, "If a city or state refuses to take the actions that are necessary to defend the life and property of their residents, then I will deploy the United States military and quickly solve the problem for them."

Is Trump's warning just bluster? Does the president have the authority to send the military into American cities?

The answer to this question involves a web of legal provisions that help define the president's constitutional roles as commander in chief and chief executive of the country and that simultaneously try to balance presidential power with the power of state leaders.

'Protect states in times of violence'

Tracing back to the Magna Carta, the British charter of liberty signed in 1215, there is a longstanding tradition against military involvement in civilian affairs.

However, the U.S. Constitution guarantees that the national government will protect the states in times of violence and permits Congress to enact laws that enable the military to aid in carrying out the law.

Almost immediately after the Constitution's enactment in 1787, Congress passed a law that allowed the president to use the military to respond to a series of citizen rebellions.

Troops serving as what's called "posse comitatus," which translates roughly to "attendants with the capacity to act," could be called to suppress insurrections and help carry out federal laws.

Following the Civil War, the national government used troops in this capacity to aid in Reconstruction efforts, particularly in states that had been part of the Confederacy.

The use of troops in this manner may even have influenced the outcome of the 1876 presidential election of Republican Rutherford B. Hayes. That happened when, in return for agreeing to withdraw federal troops from the South, Democrats informally agreed to the election of Hayes when the disputed election was thrown to a congressional commission.

Two years later, Hayes signed into law the Posse Comitatus Act, which prohibited the use of the military in civilian matters.

The Posse Comitatus Act has not changed much since that time. The law prohibits the use of the military in civilian matters but, over time, Congress has passed at least 26 exemptions to the act that allow the president to send troops into states.

The exemptions range from providing military personnel to protect national parks to helping states in carrying out state quarantine and health laws.

Peter Turnley/Corbis/VCG via Getty Images

Insurrection Act

What exemption would President Trump use if he wants to send the military to one or more states?

He would likely rely on the Insurrection Act, which governs certain circumstances when the president can use the military. Signed by Thomas Jefferson in 1807, Congress originally passed the law in order to help fight citizen rebellions against federal taxes.

Over time, the law has evolved to allow the use of troops in other circumstances. For example, Presidents Eisenhower, Kennedy and Johnson used the Insurrection Act in the 1950s and 1960s to send the military to enforce court desegregation orders and to protect civil rights marchers.

It was last invoked by President George H.W. Bush in 1992, when he ordered 4,500 troops to Los Angeles after rioting erupted in response to the acquittal of police officers charged with beating Rodney King.

The Insurrection Act says that the president may use the armed forces to subdue an insurrection or rebellion and take such measures as he considers necessary to suppress violence.

But before doing so, he must issue a proclamation ordering insurgents to disperse and return to their homes.

While state governors and legislatures also have the legal authority to ask the president to use troops in this manner, none have done that during this period of unrest. The states have preferred to rely on a combination of local law enforcement and the National Guard, which is under state command, not federal.

Not only does this strategy enable governors to maintain authority over their states' responses to the clashes in the wake of George Floyd's death, but it also keeps things more straightforward legally and politically.

Chris Sweda-Pool via Getty Images

Authority uncertain

Reliance on the Insurrection Act raises a host of political and practical questions about who is in charge when the military sends troops into a state.

For example, despite the fact that the act was invoked in response to the Rodney King riots, the military actually was not used as directed. The Joint Task Force Commander in control of the mission appears to have been confused regarding how the Insurrection Act worked alongside the provisions of the Posse Comitatus Act. He issued an order prohibiting troops from directly supporting law enforcement and that led to numerous denials of requests for assistance.

Questions about the federal government's authority in the wake of the 2005 Hurricane Katrina in Louisiana raised similar concerns.

The administration of President George W. Bush determined that it had authority under the Insurrection Act to send federal troops to the area, despite the fact that Louisiana's governor was opposed to military assistance.

For political reasons, President Bush did not end up deploying troops but, in 2006, Congress amended the law to address concerns that the military was unable to provide effective assistance to states in emergency situations.

The amendment was later repealed when all 50 state governors raised objections to what they perceived as a grant of unilateral power to the president.

These examples suggest a real difficulty balancing governmental responses to domestic crises. States need the flexibility and authority to respond as they see fit to the needs of their citizens.

But the federal government can and often does serve as a supplemental resource. As the events of the past week illustrate, striking an effective balance is rarely a straightforward thing.

[ Insight, in your inbox each day. You can get it with The Conversation's email newsletter.]

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Can the president really order the military to occupy US cities and states?

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After a week of both peaceful protests and violent chaos in the wake of George Floyd's death, President Donald Trump announced, "If a city or state refuses to take the actions that are necessary to defend the life and property of their residents, then I will deploy the United States military and quickly solve the problem for them."

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I think that the social safety net is better especially because reaganomics promote bigger wealth gaps.

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Having a military is good because it can prevent war. By having a strong military, other countries will not want to fight with the US. By preventing war a large amount of money is saved. So I think that paying a lot for the military is not a loss but a gain.

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Bernie Sanders thinks that democratic socialism is better for America because it worked in Sweden. However, I think it won't work in America because people won't have as much freedom in a democratic socialism (even if it's "democratic")

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ur saying bc japan has higher taxes America should but that makes no sense why should we follow in Japan's footsteps??

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Yes, US should maintain the spending on the military. I don't think US is paying that amount of money for just defending their own nation. Instead, I think military force is one of US' best way to maintain their international power. Also, like Rex said above, it is one of good ways to prevent anymore war.

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I agree, I like the idea of a social safety net, and how the government can have more power. This will make the economy be more balanced, and be more beneficial for people that may need help from the government.

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Trump wants to reduce the U.S. trade deficit, eliminate the national debt in the next 8 years. Individual and corporate tax cuts

IN REALITY: the debt increased by 36% in the past 4 years lol

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The economic policy of the Donald Trump administration is characterized by individual and corporate tax cuts, attempts to repeal the Patient Protection and Affordable Care Act ("Obamacare"), trade protectionism, immigration restriction, deregulation focused on the energy and financial sectors, and responses to the COVID-19 pandemic.

A key part of President Trump's economic strategy during his first three years (2017-2019) was to boost economic growth via tax cuts and additional spending, both of which significantly increased federal budget deficits. The positive economic situation he inherited from President Obama continued, with a labor market approaching full employment and measures of household income and wealth continuing to improve further into record territory. President Trump also implemented trade protectionism via tariffs, primarily on imports from China, as part of his "America First" strategy. According to the Congressional Budget Office (CBO), the number of Americans without health insurance increased under Trump, while his tax cuts were projected to worsen income inequality.

However, the 128-month (10.7 year) record economic expansion that began in June 2009 abruptly ended at a peak in February 2020, with the U.S. entering a recession. Pandemic concerns and mitigation measures resulted in over 40 million people filing for unemployment insurance the weeks of March 21 - May 28. Trump signed the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES) on March 27. CBO forecast in May 2020 that the unemployment rate would rise to nearly 16% by Q2 2020 and fall towards 10% in 2021, and that the economy would not regain its late 2019 GDP level until 2022 or later, absent additional relief legislation. As of September 2020, compared to the levels when Trump was inaugurated in January 2017, real GDP was 4% lower, the number of persons employed was 3% lower, the unemployment rate was 3.2 percentage points higher, the number of persons without health insurance was 16% higher, and the stock market was 48% higher. The CBO preliminary estimate for the fiscal year 2020 deficit is $3.1 trillion or 15.2% GDP, the largest since 1945 relative to the size of the economy.

President Trump inherited an economy in January 2017 that was already at a record level on many key measures, such as the number of persons with jobs, real median household income, household net worth, and stock market level. It also featured a low unemployment rate of 4.7%, very low inflation, and a moderate budget deficit. While Trump referred to "American carnage" in his first inaugural address and announced an "America First" economic strategy, overall the economy when he began was on solid ground in terms of major aggregate measures. The Congressional Budget Office forecast in January 2017 that assuming the continuation of Obama policies (current law), real GDP growth would be 1.8% in 2017 and 2.3% in 2018, and unemployment would continue falling to 4.4% by 2018, as the economy reached full employment.

A key part of Trump's economic strategy has been to temporarily boost growth via tax cuts and additional spending, with mixed success. Comparing the 2014-2016 period (President Obama's last three years) with the 2017-2019 period (President Trump's first three years), actual results included several variables that continued their previous improvement trends, such as the unemployment rate, which had been falling since 2010 for all ethnic groups. Some variables improved (e.g., real GDP growth and nominal wage growth) while others worsened (e.g., inflation and real wage growth). Compared to the January 2017 Congressional Budget Office (CBO) ten-year forecast just prior to Trump's inauguration, the unemployment rate, job creation, and real GDP improved over the 2017-2019 period.

Contributing to this economic performance were large annual budget deficits of $779 billion in 2018 and $984 billion in 2019, about 60% above the CBO 10-year forecast. Sustained economic expansions have historically brought down deficits, indicating the high degree to which economic stimulus has helped growth under Trump. CBO explained in January 2020 that budget deficits averaged 1.5% of GDP over the past 50 years when the economy was "relatively strong (as it is now)." However, the budget deficit was 4.6% GDP in fiscal year 2019 and was expected to average 4.8% GDP over the 2021-2030 period. The Committee for a Responsible Federal Budget estimated in January 2020 that President Trump had signed $4.2 trillion of additional debt into law for the 2017-2026 decade, and $4.7 trillion for 2017-2029. This was on top of the $17.2 trillion debt held by the public and the $9.2 trillion already expected to be added to the debt excluding these proposals.

Household financial position also improved in aggregate, with the stock market (S&P500) up a cumulative 45% through Trump's first three years, versus 53% for Obama, -2.5% for Bush and 57% for Clinton for the same time frame. Combined with rising home prices, real household net worth set new records in 2017 and 2019, despite a setback in 2018 due to a stock market decline of over 6% that year. However, the bottom 50% of households only received 4% of the gain in net worth through Q3 2019. Real median household income, a good measure of middle-class purchasing power, continued in record territory, rising from $62,898 in 2016 to $68,703 in 2019, a 3% average annual growth rate.

Trump's tax reform plan was signed into law in December 2017, which included substantial tax cuts for higher income taxpayers and corporations as well as repeal of a key Obamacare element, the individual mandate. The Joint Committee on Taxation (JCT) reported that the Tax Act would marginally increase the size of the economy and boost job creation. Due primarily to the Tax Act, the Congressional Budget Office (CBO) increased the estimated national debt addition for the 2018-2027 period by $1.6 trillion, from $10.1 trillion to $11.7 trillion, assuming the individual tax cut elements expire as scheduled after 2025. This was incremental to the existing $20trillion national debt at the time. Debt held by the public as a percentage of GDP would rise from around 77% GDP in 2017 to as much as 105% GDP by 2028.

Under the Tax Act, households in all income groups were forecast to initially get a tax cut on average, with families earning $50,000 to $75,000 receiving around $900 in 2018. However, reduced rates for individuals were scheduled to expire after 2025, contributing (along with other factors) to a tax increase for households earning $75,000 or less by 2027 relative to the continuation of prior law. Further, CBO reported that lower-income groups would incur net costs under the tax plan, either paying higher taxes or receiving fewer government benefits: those under $20,000 by 2019; those under $40,000 from 2021 to 2025; and those under $75,000 in 2027 and beyond. As a result, critics argued the tax bill unfairly benefited higher-income taxpayers and corporations at the expense of lower-income taxpayers, and therefore would significantly increase income inequality. The CBO reported in December 2019 that it expected inequality to increase from 2016 to 2021, due in part to the Trump tax cuts, with the share of income received by the top 1% rising and other groups falling, and larger tax cuts in percentage terms for higher income groups versus lower. CBS News reported on a study indicating the effective Fortune 500 corporate tax rate in 2018 was the lowest rate in 40 years, at 11.3%, versus 21.2% on average for the 2008-2015 period.

President Trump's healthcare policies have been criticized for their adverse impact. Bills to repeal and replace the Affordable Care Act ("Obamacare") supported by President Trump did not pass Congress in mid-2017, due in part to estimates that over 20 million more persons would become uninsured. The number without health insurance increased by 4.6 million or 16% from the end of 2016 through 2019; 2017 was the first year since 2010 with an increase. CBO forecast in May 2019 that 6 million more would be without health insurance in 2021 under Trump's policies (33 million), relative to continuation of Obama policies (27 million). The number of children under age 19 without health insurance increased by 425,000 from 2017 to 2018, mainly due to a decline in public coverage.

Trump's strategy of "America First" includes protectionism, which he implemented via tariffs in 2018-2019. Studies by the CBO and Federal Reserve estimated that Trump's implemented and threatened tariffs would be paid by Americans (not China or other countries, as Trump often falsely asserted) costing the typical household an estimated $580-$1,280 per year, while marginally slowing GDP and income growth. Trump withdrew the U.S. from the Trans-Pacific Partnership in January 2017, although the remaining countries implemented an alternative agreement in December 2018. Trump also signed the United States-Mexico-Canada Agreement to replace NAFTA in November, 2018.

One July 2018 study indicated Trump's policies have had little impact on the U.S. economy in terms of GDP or employment. Analysis conducted by Bloomberg News at the end of Trump's second year in office found that his economy ranked sixth among the last seven presidents, based on fourteen metrics of economic activity and financial performance. Through his first three years in office, Trump falsely characterized the economy during his presidency as the best in American history over 250 times.

Trump signed the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES) on March 27, which funded increased unemployment insurance amounts and duration, loans and grants to businesses, and funding for state governments.

The CBO forecast in April 2020 that the budget deficit in fiscal year 2020 would be $3.7 trillion (17.9% GDP), versus the January estimate of $1 trillion (4.6% GDP). The CBO also reported in May 2020 that:

The unemployment rate increased from 3.5% in February to 14.7% in April, representing a decline of more than 25 million people employed, plus another 8 million persons that exited the labor force.

Job declines were focused on industries that rely on "in-person interactions" such as retail, education, health services, leisure and hospitality. For example, 8 of the 17 million leisure and hospitality jobs were lost in March and April.

The economic impact was expected to hit smaller and newer businesses harder, as they typically have less financial cushion.

Real (inflation-adjusted) consumer spending fell 17% from February to April, as social distancing reached its peak. In April, car and light truck sales were 49% below the late 2019 monthly average. Mortgage applications fell 30% in April 2020 versus April 2019.

Real GDP was forecast to fall at a nearly 38% annual rate in the second quarter, or 11.2% versus the prior quarter, with a return to positive quarter-to-quarter growth of 5.0% in Q3 and 2.5% in Q4 2020. However, real GDP was not expected to regain its Q4 2019 level until 2022 or later.

The unemployment rate was forecast to average 11.5% in 2020 and 9.3% in 2021.

The New York Times reported that the economy (real GDP) contracted by a record 9.5% in Q2 2020 (32.6% annualized), which reduced the overall size of the economy to early 2015 levels. This was twice as large a decline as the Great Recession. This was attributed to failure to control the coronavirus. However, government efforts at financial support (the $2 trillion CARES Act) were largely successful in helping about 30 million people receiving unemployment benefits as of late July.

The economic policy positions of United States President Donald Trump prior to his election had elements from across the political spectrum. However, once in office his actions indicated a politically rightward shift towards more conservative economic policies.

Prior to election, then-candidate Trump proposed sizable income tax cuts and deregulation consistent with conservative ( Republican Party) policies, along with significant infrastructure investment and status-quo protection for entitlements for the elderly, typically considered liberal ( Democratic Party) policies. His anti-globalization policies of trade protectionism and immigration reduction cross party lines. This combination of policy positions from both parties could be considered " populist" and likely succeeded in converting some of the 2012 Obama voters who became Trump voters in 2016.

President Trump's 2018 United States federal budget was a statement of his administration's economic priorities for the following decade and indicated a rightward (i.e., more conservative) shift relative to the CBO January 2017 ten-year forecast:

Republican agenda elements: Nearly $2 trillion in healthcare spending reductions (primarily from Medicaid, a program for lower-income persons), about $1.5 trillion in non-defense discretionary spending cuts, and about $1 trillion in corporate and income tax cuts, representing a net deficit reduction of $2.5 trillion.

Democratic agenda elements: A net reduction in defense spending of $300 billion, and about $200 billion more for infrastructure, for a net deficit reduction of $100 billion.

Journalist Matthew Yglesias wrote in December 2017 that while Trump campaigned as a populist, much of his post-election economic agenda has been consistent with far-right economic policy: "His decision to refashion himself in office as a down-the-line exponent of hard-right policies has been the key strategic decision of the Trump presidency." Yglesias hypothesized this was a bargain to reduce Congressional oversight of the executive branch. Economist Paul Krugman expressed a similar view in February 2020, writing that Trump's initial promises of a more bi-partisan agenda (e.g., raising taxes on the rich, infrastructure investment and preserving safety net programs) ultimately gave way to pursuing more typical Republican policy priorities of tax cuts and reduced safety net spending, although without the previous concerns about the budget deficit that Republicans expressed during the Obama Administration.

Writing in The New York Times, Steven Rattner explained in August 2018 that "Yes, the economy is continuing to expand nicely, which all Americans should celebrate. But no, there's nothing remarkable in the overall results since Mr. Trump took office. Most importantly, there is little evidence that the president's policies have meaningfully improved the fortunes of those 'forgotten' Americans who elected him." Rattner explained that job creation and real wage growth had slowed comparing the end of the Obama administration with an equal period elapsed during the Trump administration; that the 4.1% real GDP growth in Q2 2018 was increased by non-recurring trade contributions and was exceeded during four quarters of the Obama Administration; that 84% of the benefits of the Trump tax cuts would go to businesses and individuals with incomes greater than $75,000 (thus increasing inequality); that the tax cuts and spending increases were forecast to increase the budget deficit in 2019 to nearly $1 trillion, double the previous forecast; and that half the benefit of the tax cuts for the typical middle-class worker in 2018 would be offset by higher gas prices. Rattner expanded his analysis in December 2018, explaining further that the debt to GDP ratio was on a much higher trajectory compared to the forecast when Trump took office, with as much as $16 trillion more federal debt added over a decade.

NBC explained in August 2020 that Trump inherited a solid economy: "If you compare key economic indicators from Barack Obama's second term in office to the first three years of Trump's time (that is, before the pandemic hit), the data show a continuation of trends, not a dramatic shift. It suggests Trump didn't build something new; rather he inherited a pretty good situation."

The following table illustrates some of the key economic variables in the last three years of the Obama Administration (2014-2016) and the first three years of the Trump Administration(2017-2019). The arrows indicate whether the variable improved (green) or worsened (red) versus the prior year.

Variable

2014

2015

2016

2017

2018

2019

Number uninsured under 65 yrs. (millions)[82][83]

35.7

28.4

28.2

28.9

30.1

32.8

Carbon dioxide emissions (Metric tons in millions)[90]

5,413

5,263

5,170

5,131

5,280

Not avail.

The following table illustrates the impact of the pandemic on key economic measures. February 2020 represented the pre-crisis level for most monthly variables, with the S&P 500 stock market index (a leading daily indicator) falling from its February 19 peak.

The following table compares the latest economic data with levels at the time of Trump's inauguration in January 2017. For quarterly or annual variables, the figure closest to the date indicated is used. For the deficit, the CBO forecast for FY2020 is used.

On January 15, 2017, president-elect Trump said he was nearing completion of a new health insurance program to replace Obamacare, stating, "We're going to have insurance for everybody." However, no such plan was proposed from 2017-2019, and both government and private analyses indicate gains in healthcare coverage under President Obama began to reverse under President Trump during that time:

The Centers for Disease Control reported that the number of uninsured persons under age 65 rose from 28.2 million in 2016 to 32.8 million in 2019, an increase of 4.6 million or 16%; 2017 was the first year since 2010 with an increase. The rate of uninsured rose from 10.4% in 2016 to 12.1% in 2019.

The Census Bureau reported in September 2020 that the number of uninsured increased from 27.3 million in 2016 to 29.6 million in 2019, an increase of 2.3 million or 8%. The rate of uninsured rose from 8.6% in 2016 to 9.2% in 2019. Further, the number of children under age 19 without health insurance increased from 3.9 million in 2017 to 4.3 million in 2018 (mainly due to declines in public coverage), then fell to 4.0 million in 2019.

CBO forecast in May 2019 that 6 million more would be without health insurance in 2021 under Trump's policies (33 million), relative to continuation of Obama policies (27 million).

The Commonwealth Fund reported that the number of uninsured was increasing due to two factors: 1) Not addressing specific weaknesses in the ACA; and 2) Actions by the Trump administration that exacerbated those weaknesses. The impact was greater among lower-income adults, who had a higher uninsured rate than higher-income adults. Regionally, the South and West had higher uninsured rates than the North and East. Further, those 18 states that have not expanded Medicaid had a higher uninsured rate than those that did. Gallup cited a "number of factors" for the increase, including: an increase in 2018 premiums; reduction in marketing and enrollment periods; reduced funding for enrollment support; elimination of the individual mandate; and elimination of cost-sharing reduction subsidies. The Washington Post cited research indicating that mortality increases about one person per 800 without health insurance, so 2 million more uninsured represents 2,500 avoidable deaths per year.

President Trump advocated repealing and replacing the Affordable Care Act (ACA or "Obamacare"). The Republican-controlled House passed the American Health Care Act (AHCA) in May 2017, handing it to the Senate, which decided to write its own version of the bill rather than voting on the AHCA. The Senate bill, called the "Better Care Reconciliation Act of 2017" (BCRA), failed on a vote of 45-55 in the Senate during July 2017. Other variations also failed to gather the required support, facing unanimous Democratic Party opposition and some Republican opposition. The Congressional Budget Office estimated that the bills would increase the number of uninsured by over 20 million persons while reducing the budget deficit marginally.

Weakening the individual mandate through his first executive order, which resulted in limiting enforcement of mandate penalties by the IRS. For example, tax returns without indications of health insurance ("silent returns") will still be processed, overriding instructions from the Obama administration to the IRS to reject them.

Reducing funding for advertising for the 2017 and 2018 exchange enrollment periods by up to 90%, with other reductions to support resources used to answer questions and help people sign-up for coverage. This action could reduce ACA enrollment.

Cutting the enrollment period for 2018 by half, to 45 days. The NYT editorial board referred to this as part of a concerted "sabotage" effort.

Issuing public statements that the exchanges are unstable or in a death spiral. CBO reported in May 2017 that the exchanges would remain stable under current law (ACA), but would be less stable if the AHCA were passed.

Several insurers and actuary groups cited uncertainty created by President Trump, specifically non-enforcement of the individual mandate and not funding cost sharing reduction subsidies, as contributing 20-30 percentage points to premium increases for the 2018 plan year on the ACA exchanges. In other words, absent Trump's actions against the ACA, premium increases would have averaged 10% or less, rather than the estimated 28-40% under the uncertainty his actions created. The Center on Budget and Policy Priorities (CBPP) maintains a timeline of many "sabotage" efforts by the Trump Administration.

President Trump signed the Tax Cuts and Jobs Act into law in December 2017, which included the repeal of the individual mandate of the Affordable Care Act (ACA). This removed the requirement that all persons purchase health insurance or pay a penalty. The Congressional Budget Office estimated that up to 13 million fewer persons would be covered by health insurance by 2027 relative to prior law and insurance premiums on the exchanges would increase by about 10 percentage points. This is because removing the mandate encourages younger and typically healthier persons to opt out of health insurance on the ACA exchanges, increasing premiums for the remainder. The non-group insurance market (which includes the ACA exchanges) would continue to be stable (i.e., no "death spiral"). CBO estimated this would reduce government spending for healthcare subsidies to lower income persons by up to $338 billion in total during the 2018-2027 period compared to the prior law baseline. Trump stated in an interview with The New York Times in December 2017: "I believe we can do health care in a bipartisan way, because we've essentially gutted and ended Obamacare."

President Trump and Republicans in Congress tried repeatedly to repeal or replace the ACA, without success. In February 2018, 20 states, led by Texas Attorney General Ken Paxton and Wisconsin Attorney General Brad Schimel, filed a lawsuit against the federal government alleging the ACA is now unconstitutional because the individual mandate tax which NFIB v. Sebelius rested on was repealed by the Tax Cuts and Jobs Act of 2017.

Writing in the Washington Post in September 2020, Catherine Rampell summarized some of the adverse consequences if the ACA is overturned by the U.S. Supreme Court:

50+ million non-elderly adults with pre-existing conditions could be declined health insurance, or be charged more by insurance companies

12+ million low-income persons would become ineligible for Medicaid, thereby losing insurance

9+ million persons receiving tax credits to reduce insurance premiums on the exchanges would either pay more or lose coverage

Minimum essential coverage for prescription benefits and substance abuse treatment would no longer be required in insurance policies

Children would no longer be able to stay on their parents' plans until age 26

Preventive care would again involve cost-sharing (co-pays)

More Americans would have healthcare plans without comprehensive protection

Insurance companies would again be able to impose lifetime limits.

In October 2017 the Republican-controlled Senate and House passed a resolution to provide for $1.5 trillion in deficits over ten years to enable enactment of the Trump tax cut. As Reuters reported:

Republicans are traditionally opposed to letting the deficit grow. But in a stark reversal of that stance, the party's budget resolution, previously passed by the Senate, called for adding up to $1.5 trillion to federal deficits over the next decade to pay for the tax cuts.

Major elements of the new tax law include reducing tax rates for businesses and individuals; a personal tax simplification by increasing the standard deduction and family tax credits, but eliminating personal exemptions and making it less beneficial to itemize deductions; limiting deductions for state and local income taxes (SALT) and property taxes; further limiting the mortgage interest deduction; reducing the alternative minimum tax for individuals and eliminating it for corporations; reducing the number of estates impacted by the estate tax; and repealing the individual mandate of the Affordable Care Act (ACA).

Just prior to signing the bill, Trump asserted the new tax law might generate GDP growth as high as 6%.

The non-partisan Joint Committee on Taxation of the U.S. Congress published its macroeconomic analysis of the Senate version of the Act, on November 30, 2017:

Gross domestic product would be 0.7% higher on average each year during the 2018-2027 period relative to the CBO baseline forecast, a cumulative total of $1,895 billion, due to an increase in labor supply and business investment. This is the level of GDP, not annual growth rate, so the economic impact is relatively minor.

Employment would be about 0.6% higher each year during the 2018-2027 period than otherwise. The lower marginal tax rate on labor would provide "strong incentives for an increase in labor supply."

Personal consumption, the largest component of GDP, would increase by 0.6%.

The CBO estimated in April 2018 that implementing the Act would add an estimated $2.289 trillion to the national debt over ten years, or about $1.891trillion ($15,000 per household) after taking into account macroeconomic feedback effects, in addition to the $9.8trillion increase forecast under the current policy baseline and existing $20trillion national debt.

As Trump celebrated the six-month anniversary of the tax cut on June 29, 2018, National Economic Council director Larry Kudlow asserted that the tax cut was generating such growth that "it's throwing off enormous amount[s] of new tax revenues" and "the deficit, which was one of the other criticisms, is coming down-and it's coming down rapidly." Both assertions were incorrect. Since the tax cut was enacted, federal tax receipts increased 1.9% on a year-on-year basis, while they increased 4.0% during the comparable period in 2017. By the same method, the federal budget deficit increased 37.8% while it increased 16.4% during the comparable period in 2017. Kevin Hassett, chairman of Trump's Council of Economic Advisers, noted days earlier that the deficit was "skyrocketing," which is consistent with the analysis of every reputable budget analyst. Kudlow later asserted he was referring to future deficits, although every credible budget forecast indicates increasing deficits in coming years, made worse by the Trump tax cut if not offset by major spending cuts. Barring such spending cuts, the CBO projected the tax cut would add $1.27 trillion in deficits over the next decade, even after considering any economic growth the tax cut might generate.

The Trump administration predicted the tax cut would spur corporate capital investment and hiring. One year after enactment of the tax cut, a National Association for Business Economics survey of corporate economists found that 84% reported their firms had not changed their investment or hiring plans due to the tax cut. The International Monetary Fund also found the tax cut had little impact on business investment decisions, while the Penn Wharton Budget Model found that the increasing price of oil "explains the entire increase in the growth rate of investment in 2018." Trump has on several occasions taken credit for business investments that began before he became president.

Analysis released by the Congressional Research Service in May 2019 found that "On the whole, the growth effects tend to show a relatively small (if any) first-year effect on the economy." Analysis conducted by The New York Times in November 2019 found that average business investment was lower after the tax cut than before, and that firms receiving larger tax relief increased investment less than firms receiving smaller tax relief. The analysis also found that since the tax cut firms increased dividends and stock buybacks by nearly three times as much as they increased capital investments.

In a December 2019 opinion piece, former Trump economic advisors Kevin Hassett and Gary Cohn argued that the Trump tax cut had caused wages to rise faster for lower-wage workers than for higher-wage workers, thus delivering on a Trump campaign promise. Other analysts noted wages at the lower end of the income scale had increased at least in part due to numerous states raising their minimum wage in recent years.

The distribution of impact from the final version of the Act by individual income group varies significantly based on the assumptions involved and point in time measured. In general, businesses and upper income groups will mostly benefit regardless, while lower income groups will see the initial benefits fade over time or be adversely impacted. CBO reported on December 21, 2017, that: "Overall, the combined effect of the change in net federal revenue and spending is to decrease deficits (primarily stemming from reductions in spending) allocated to lower-income tax filing units and to increase deficits (primarily stemming from reductions in taxes) allocated to higher-income tax filing units."

For example:

During 2019, income groups earning under $20,000 (about 23% of taxpayers) would contribute to deficit reduction (i.e., incur a cost), mainly by receiving fewer subsidies due to the repeal of the individual mandate of the Affordable Care Act. Other groups would contribute to deficit increases (i.e., receive a benefit), mainly due to tax cuts.

During 2021, 2023, and 2025, income groups earning under $40,000 (about 43% of taxpayers) would contribute to deficit reduction, while income groups above $40,000 would contribute to deficit increases.

During 2027, income groups earning under $75,000 (about 76% of taxpayers) would contribute to deficit reduction, while income groups above $75,000 would contribute to deficit increases.

Compared to current law, 5% of taxpayers would pay more in 2018, 9% in 2025, and 53% in 2027.

The top 1% of taxpayers (income over $732,800) would receive 8% of the benefit in 2018, 25% in 2025, and 83% in 2027.

The top 5% (income over $307,900) would receive 43% of the benefit in 2018, 47% in 2025, and 99% in 2027.

The top 20% (income over $149,400) would receive 65% of the benefit in 2018, 66% in 2025 and all of the benefit in 2027.

The bottom 80% (income under $149,400) would receive 35% of the benefit in 2018, 34% in 2025 and none of the benefit in 2027, with some groups incurring costs.

The third quintile (taxpayers in the 40th to 60th percentile with income between $48,600 and $86,100, a proxy for the "middle class") would receive 11% of the benefit in 2018 and 2025, but would incur a net cost in 2027.

The TPC also estimated the amount of the tax cut each group would receive, measured in 2017 dollars:

The Institute on Taxation and Economic Policy (ITEP) reported in December 2019 that:

The Economic Policy Institute reported in December 2019 that:

Working people saw no discernible wage increase due to the Tax Act. The tight labor market and higher state-level minimum wages can explain the wage growth in 2018.

The Tax Act has not increased business investment, with the small increase in 2018 a "natural bounceback" from a weak 2015-2016, and a sizable decline in 2019.

Companies used much of the tax benefit for stock buybacks, to the tune of $580 billion in 2018, an increase of 50% from 2017.

A FiveThirtyEight average of November 2017 surveys showed that 32% of voters approved of the legislation while 46% opposed it. This made the 2017 tax plan less popular than any tax proposal since 1981, including the tax increases of 1990 and 1993. Trump has claimed the tax cuts on the wealthy and corporations would be "paid for by growth", although 37 economists polled by the University of Chicago unanimously rejected the claim. The Washington Posts fact-checker has found that Trump's claims that his economic proposal and tax plan would not benefit wealthy persons like himself are provably false. The elimination of the estate tax (which only applies to inherited wealth greater than $11 million for a married couple) benefits only the heirs of the very rich (such as Trump's children), and there is a reduced tax rate for people who report business income on their individual returns (as Trump does). If Trump's tax plan had been in place in 2005 (the one recent year in which his tax returns were leaked), he would have saved $31 million in taxes from the alternative minimum tax cut alone. If the most recent estimate of the value of Trump's assets is correct, the repeal of the estate tax could save his family about $1.1 billion.

Treasury Secretary Steven Mnuchin argued that the corporate income tax cut will benefit workers the most; however, the nonpartisan Joint Committee on Taxation and Congressional Budget Office estimate that owners of capital benefit vastly more than workers.

Economist and former Treasury Secretary Larry Summers referred to the analysis provided by the Trump administration of its tax proposal as "...some combination of dishonest, incompetent, and absurd." Summers continued that "...there is no peer-reviewed support for [the Administration's] central claim that cutting the corporate tax rate from 35 percent to 20 percent would raise wages by $4,000 per worker. The claim is absurd on its face."

On the day Trump signed the tax bill, polls showed that 30% of Americans approved of the new law. While its popularity has increased somewhat since, through August 2018 a plurality of Americans still dislike the law.

Despite every independent economic analysis concluding that the tax cut would increase deficits, a June 2018 survey found that 22% of Republicans agreed with that conclusion, while nearly 70% of Democrats agreed.

Federal budget deficit and debt 2017-2019

President Trump's policies have significantly increased the budget deficits and U.S. debt trajectory over the 2017-2027 time periods.

Fiscal year 2018 (FY 2018) ran from October 1, 2017, through September 30, 2018. It was the first fiscal year budgeted by President Trump. The Treasury department reported on October 15, 2018, that the budget deficit rose from $666 billion in FY2017 to $779 billion in FY2018, an increase of $113 billion or 17.0%. Corporate tax receipts fell by 31%, accounting for most of the deficit increase. Compared with 2017, tax receipts fell by 0.8% GDP, while outlays fell by 0.4% GDP. The 2018 deficit was an estimated 3.9% of GDP, up from 3.5% GDP in 2017.

The FY2018 deficit increased about 60% from the $487 billion level forecast by CBO in January 2017, just prior to Trump's inauguration. The deficit increase relative to this forecast was due to Trump's tax cuts and additional spending. CBO forecast in January 2017 that tax revenues in fiscal year 2018 would be $3.60 trillion if laws in place as of January 2017 continued. However, actual 2018 revenues were $3.33 trillion, a shortfall of $270 billion (7.5%) relative to the forecast. This difference is primarily due to the Tax Act. In other words, revenues would have been considerably higher in the absence of the tax cuts.

The debt additions projected by CBO for the 2017-2027 period have increased from the $10.0 trillion that Trump inherited from Obama (January 2017 CBO baseline) to $13.7 trillion (CBO January 2019 current policy baseline), a $3.7 trillion or 37% increase.

As a presidential candidate, Trump pledged to eliminate $19 trillion in federal debt in eight years. Trump and his economic advisers initially pledged to radically decrease federal spending in order to reduce the country's budget deficit. A first estimate of $10.5 trillion in spending cuts over 10 years was reported on January 19, 2017, although cuts of this size did not appear in Trump's 2018 budget. However, the CBO forecast in the April 2018 baseline for the 2018-2027 period includes much larger annual deficits than the January 2017 baseline he inherited from President Obama, due to the Tax Cuts and Jobs Act and other spending bills.

The Committee for a Responsible Federal Budget estimated in January 2020 that President Trump had signed $4.2 trillion of additional debt into law for the 2017-2026 decade, and $4.7 trillion for 2017-2029. This is on top of the $17.2 trillion debt held by the public and the $9.2 trillion already expected to be added to the debt excluding these proposals. About half was the Tax Act, and the other half was spending increases. This analysis assumed the individual tax cuts expire as scheduled after 2025; if extended, up to another $1 trillion could be added through 2029. The Bipartisan Budget Act of 2018 and Bipartisan Budget Act of 2019 added $2.2 trillion to the projected debt, mainly by increasing defense and non-defense discretionary spending caps through 2017-2021. There are no such caps after 2021. A December 2019 spending deal added another $500 billion of debt through additional tax cuts, repealing 3 taxes meant to fund the Affordable Care Act, including the so-called "Cadillac tax" on unusually generous health plans.

CBO also estimated that if policies in place as of the end of the Obama administration continued over the following decade (i.e., the January 2017 10-year forecast or baseline), real GDP would grow at approximately 2% per year, the unemployment rate would remain around 5%, inflation would remain around 2%, and interest rates would rise moderately. This forecast assumed the U.S. was very close to full employment by the time President Trump took office and that deficits would fall through 2018. With the notable exception of deficits, actual results for 2017-2019 for the these key variables compare favorably against the baseline, as the Tax Cuts and Jobs Act provided a stimulus and the economy was further from full employment than CBO anticipated:

A budget document is a statement of goals and priorities, but requires separate legislation to achieve them. As of January 2018, the Tax Cuts and Jobs Act was the primary legislation passed that moved the budget closer to the priorities set by Trump.

Trump released his first budget, for FY2018, on May 23, 2017. It proposed unprecedented spending reductions across most of the federal government, totaling $4.5 trillion over ten years, including a 33% cut for the State Department, 31% for the EPA, 21% each for the Agriculture Department and Labor Department, and 18% for the Department of Health and Human Services, with single-digit increases for the Department of Veterans Affairs, Department of Homeland Security and the Defense Department. The Republican-controlled Congress promptly rejected the proposal. Instead, Congress pursued an alternative FY2018 budget linked to their tax reform agenda; this budget was adopted in late 2017, after the 2018 fiscal year had begun. The budget agreement included a resolution specifically providing for $1.5 trillion in new budget deficits over ten years to accommodate the Tax Cuts and Jobs Act that would be enacted weeks later.

The Congressional Budget Office reported its evaluation of President Trump's FY2018 budget on July 13, 2017, including its effects over the 2018-2027 period.

Mandatory spending: The budget cuts mandatory spending by a net $2,033 billion (B) over the 2018-2027 period. This includes reduced spending of $1,891B for healthcare, mainly due to the proposed repeal and replacement of the Affordable Care Act (ACA/Obamacare); $238B in income security ("welfare"); and $100B in reduced subsidies for student loans. This savings would be partially offset by $200B in additional infrastructure investment.

Discretionary spending: The budget cuts discretionary spending by a net $1,851 billion over the 2018-2027 period. This includes reduced spending of $752 billion for overseas contingency operations (defense spending in Afghanistan and other foreign countries), which is partially offset by other increases in defense spending of $448B, for a net defense cut of $304B. Other discretionary spending (cabinet departments) would be reduced by $1,548B.

Revenues would be reduced by $1,000B, mainly by repealing the ACA, which had applied higher tax rates to the top 5% of income earners. Trump's budget proposal was not sufficiently specific to score other tax proposals; these were simply described as "deficit neutral" by the Administration.

Deficits: CBO estimated that based on the policies in place as of the start of the Trump administration, the debt increase over the 2018-2027 period would be $10,112B. If all of President Trump's proposals were implemented, CBO estimated that the sum of the deficits (debt increases) for the 2018-2027 period would be reduced by $3,276B, resulting in $6,836B in total debt added over the period.

CBO estimated that the debt held by the public, the major subset of the national debt, would rise from $14,168B (77.0% GDP) in 2016 to $22,337B (79.8% GDP) in 2027 under the President's budget, versus 91.2% GDP under the pre-Trump policy baseline.

Fiscal year 2017 (FY2017) ran from October 1, 2016, to September 30, 2017; President Trump was inaugurated in January 2017, so he began office in the fourth month of the fiscal year, which was budgeted by President Obama. In FY2017, the actual budget deficit was $666 billion, $80 billion more than FY2016. FY2017 revenues were up $48 billion (1%) vs. FY2016, while spending was up $128 billion (3%). The deficit was $107 billion more than the CBO January 2017 baseline forecast of $559 billion. The deficit increased to 3.5% GDP, up from 3.2% GDP in 2016 and 2.4% GDP in 2015.

During January 2017, just prior to President Trump's inauguration, CBO forecast that the FY 2018 budget deficit would be $487 billion if laws in place at that time remained in place. The $779 billion actual result represents a $292 billion or 60% increase versus that forecast. This difference was mainly due to the Tax Cuts and Jobs Act, which took effect in 2018, and other spending legislation.

During January 2017, just prior to President Trump's inauguration, CBO forecast that the FY 2019 budget deficit would be $601 billion if laws in place at that time remained in place. The $984 billion actual result represents a $383 billion or 64% increase versus that forecast. This difference was mainly due to the Tax Cuts and Jobs Act, which took effect in 2018, and other spending legislation.

The New York Times reported in October 2019 that: "In fact, tax revenue for the last two years has fallen more than $400 billion short of what the Congressional Budget Office projected in June 2017, six months before the tax law was passed." The Treasury Department expects the deficit to exceed $1 trillion in FY2020. The budget deficit has increased nearly 50% since Trump took office and has increased for the past four years. This is contrary to Trump's promises to eliminate deficits within 8 years. The 2019 calendar year deficit exceeded $1 trillion.

The CBO estimated the impact of Trump's tax cuts and separate spending legislation over the 2018-2028 period in their annual "Budget & Economic Outlook", released in April 2018:

CBO forecasts a stronger economy over the 2018-2019 periods than do many outside economists, blunting some of the deficit impact of the tax cuts and spending increases.

Real (inflation-adjusted) GDP, a key measure of economic growth, is expected to increase 3.3% in 2018 and 2.4% in 2019, versus 2.6% in 2017. It is projected to average 1.7% from 2020-2026 and 1.8% in 2027-2028. Over 2017-2027, real GDP is expected to grow 2.0% on average under the April 2018 baseline, versus 1.9% under the June 2017 baseline.

The non-farm employment level would be about 1.1 million higher on average over the 2018-2028 period, about 0.7% level higher than the June 2017 baseline.

The budget deficit in fiscal 2018 (which runs from October 1, 2017, to September 30, 2018, the first year budgeted by President Trump) is forecast to be $804 billion, an increase of $139 billion (21%) from the $665 billion in 2017 and up $242 billion (39%) over the previous baseline forecast (June 2017) of $580 billion for 2018. The June 2017 forecast was essentially the budget trajectory inherited from President Obama; it was prepared prior to the Tax Act and other spending increases under President Trump.

For the 2018-2027 period, CBO projects the sum of the annual deficits (i.e., debt increase) to be $11.7 trillion, an increase of $1.6 trillion (16%) over the previous baseline (June 2017) forecast of $10.1 trillion.

The $1.6 trillion debt increase includes three main elements: 1) $1.7 trillion less in revenues due to the tax cuts; 2) $1.0 trillion more in spending; and 3) Partially offsetting incremental revenue of $1.1 trillion due to higher economic growth than previously forecast. The $1.6 trillion figure is approximately $12,700 per family or $4,900 per person total.

Debt held by the public is expected to rise from 78% of GDP ($16 trillion) at the end of 2018 to 96% GDP ($29 trillion) by 2028. That would be the highest level since the end of World War Two.

CBO estimated under an alternative scenario (in which policies in place as of April 2018 are maintained beyond scheduled initiation or expiration) that deficits would be considerably higher, rising by $13.7 trillion over the 2018-2027 period, an increase of $3.6 trillion (36%) over the June 2017 baseline forecast. Maintaining current policies for example would include extending the individual Trump tax cuts past their scheduled expiration in 2025, among other changes. The $3.6 trillion figure is approximately $28,500 per household or $11,000 per person total.

Federal corporate income tax receipts fell from about $297 billion in fiscal year 2017 (prior to the Trump tax cuts) to $205 billion in fiscal year 2018, nearly one-third. This revenue decline occurred despite a growing economy and corporate profits, which ordinarily would cause tax receipts to increase. Corporate tax receipts fell from 1.5% GDP in 2017 to 1.0% GDP in 2018. The pre-Great Recession historical average (1980-2007) was 1.8% GDP.

On December 22, 2018, the federal government went into a partial shutdown caused by the expiration of funding for nine Executive departments, although only one such budget - Homeland Security - was actually in contention. Approximately 800,000 federal employees were either furloughed or made to work without pay, and some public services were shut down. The shutdown ended on January 25, 2019, with the total shutdown period extending over a month, the longest in American history. By mid-January 2019, the White House Council of Economic Advisors estimated that each week of the shutdown reduced GDP growth by 0.1 percentage points, the equivalent of 1.2 points per quarter. CEA chairman Kevin Hassett later acknowledged that GDP growth could decline to zero in the first quarter of 2019 if the shutdown lasted the entire quarter.

Federal budget deficit 2020-

The CBO forecast in April 2020 that the budget deficit in fiscal year 2020 would be $3.7 trillion (17.9% GDP), versus the January estimate of $1 trillion (4.6% GDP). The COVID-19 pandemic in the United States impacted the economy significantly beginning in March 2020, as businesses were shut-down and furloughed or fired personnel. About 20 million persons filed for unemployment insurance in the four weeks ending April 11. It caused the number of unemployed persons to increase significantly, which is expected to reduce tax revenues while increasing automatic stabilizer spending for unemployment insurance and nutritional support. As a result of the adverse economic impact, both state and federal budget deficits will dramatically increase, even before considering any new legislation.

CBO provided a preliminary score for the CARES Act on April 16, 2020, estimating that it would increase federal deficits by about $1.8 trillion over the 2020-2030 period. The estimate includes:

A $988 billion increase in mandatory outlays;

A $446 billion decrease in revenues; and

A $326 billion increase in discretionary outlays, stemming from emergency supplemental appropriations.

CBO reported that not all parts of the bill will increase deficits: "Although the act provides financial assistance totaling more than $2 trillion, the projected cost is less than that because some of that assistance is in the form of loan guarantees, which are not estimated to have a net effect on the budget. In particular, the act authorizes the Secretary of the Treasury to provide up to $454 billion to fund emergency lending facilities established by the Board of Governors of the Federal Reserve System. Because the income and costs stemming from that lending are expected to roughly offset each other, CBO estimates no deficit effect from that provision".

The Committee for a Responsible Federal Budget estimated that the budget deficit for fiscal year 2020 would increase to a record $3.8 trillion, or 18.7% GDP. For scale, in 2009 the budget deficit reached 9.8% GDP ($1.4 trillion nominal dollars) in the depths of the Great Recession. CBO forecast in January 2020 that the budget deficit in FY2020 would be $1.0 trillion, prior to considering the impact of the coronavirus pandemic or CARES.

As a candidate in 2016, Trump promised to create 25 million new jobs over the next decade. While job creation was sufficient to continue reducing the unemployment rate, it has been somewhat slower under President Trump relative to the end of the Obama Administration.

Factcheck.org reported in January 2020 that job gains under Trump are "far behind the pace needed to fulfill his campaign boast...At this rate, he will not even come up to the gains made during Obama's final term. The average monthly gain under Trump [as of December 2019] is 191,000-compared with an average monthly gain of 217,000 during the four years before he took office."

During Trump's first 36 months in office (through January 2020), 6.6 million jobs were created, versus 8.1 million in the last 36 months of the Obama administration. This is an average of 182,000 jobs per month created under Trump versus 224,000 under Obama during those periods.

Discussing the economy on July 27, 2018, Trump stated, "We have added 3.7 million new jobs since the election, a number that is unthinkable if you go back to the campaign. Nobody would have said it." While this figure was accurate for the 19 months following the election, during the 19 months prior to the election, 3.9 million jobs were created.

An August 2018 analysis by the Associated Press found that during the year ended May, 58.5% of job creation was in counties that Trump did not carry in the 2016 election, similar to the results during the months prior to Trump's presidency. Over 35% of counties Trump carried showed job losses, compared to 19.2% of counties carried by Clinton.

The BLS publishes the number of full-time (FT) and part-time (PT) employed. This data is gathered from a different economic survey ("Household Survey") than the one used for jobs data ("Establishment Survey"). The data for the January 2015 to June 2019 period indicates:

During the Obama administration, the unemployment rate peaked at 10.0% in October 2009 due to the Great Recession, and then fell consistently to 4.7% in December 2016, a total reduction of 5.3 percentage points. The historical average unemployment rate is 5.6%, indicating the relatively low level of unemployment inherited by President Trump. It continued falling during the Trump administration to 3.5% by December 2019, another 1.2 percentage points. The average unemployment rate through Trump's first 35 months (December 2019) was 3.9%, the lowest of any modern President.

Unemployment rate improvements were apparent across all ethnic groups during both administrations. For example, black unemployment peaked at 16.8% in March 2010 and fell to 7.9% by December 2016. During the Trump administration, it fell to 5.9% as of December 2019. By May 2018, black American and Asian American unemployment hit its lowest level since record-keeping began in 1972 and 2003, respectively.

The Trump administration seeks to encourage people with disabilities to work in order to save money for the government and to meet the demands of a growing economy with tightening labor markets. In 2019, U.S. unemployment reached the lowest point in 50 years. Companies have had trouble finding employees and many are willing to hire those with disabilities. The number of people who quit disability rolls and successfully found a job increased each year from 2014 through 2017.

The labor force participation rate among prime-aged workers (aged 25-54) hit post-recession lows of 80.6% October 2013 and September 2015, then improved thereafter. It reached 81.4% in December 2016 at the end of the Obama administration and continued increasing to 82.9% by December 2019.

The number of persons working part-time for economic reasons (i.e., would prefer to work full-time) declined from the September 2010 peak of 9.2 million to 5.6 million in December 2016 at the end of the Obama administration, a reduction of 3.6 million. It continued downward to 4.1 million by December 2019, a further reduction of 1.5 million.

Trump ran on a campaign to improve wages for the working class, and as president he falsely asserted on several occasions that wages were rising for the first time in as many as 22 years. However, the average real (inflation-adjusted) hourly wage for private sector production and nonsupervisory workers (loosely, "working-class" workers) began steadily rising in November 2012, and that wage growth slowed under Trump compared to prior years, mainly due to increases in energy prices. Trump and Republicans have asserted that the corporate tax cut in the Tax Cuts and Jobs Act would cause employers to pass their tax savings on to workers in the form of wage increases, while critics predicted companies would spend most of the savings on stock repurchases and dividends to shareholders. Early evidence appeared to confirm the latter.

For example, average hourly earnings (for all employees on private nonfarm payrolls) rose from $26.26 in June 2017 to $26.98 in June 2018, an increase of $0.72 or 2.74%. However, inflation (CPI-U, for all items) rose 2.8% for the 12 months ending May 2018, indicating that workers' real (inflation-adjusted) hourly earnings were essentially unchanged over that mid-2017 to mid-2018 period. Real wage growth turned negative in June 2018, as the inflation rate was higher than nominal wage growth, continuing into July.

Average hourly earnings increased from 2015-2016 to 2017-2018 in nominal terms, but since inflation was higher in the latter period, real earnings growth was lower. For example, average hourly earnings growth rates for production and non-supervisory workers (a proxy for middle-class workers) increased in nominal terms from 2.3% for the 2015-2016 period, to 2.6% for the 2017-2018 period. However, in real (inflation-adjusted) terms, the growth rate was faster at 1.6% in 2015-2016 versus the 0.3% in 2017-2018, as inflation was higher in the latter period. For all employees, which includes higher wage managers, the pattern is similar, with faster nominal growth in 2017-2018 at 2.7% versus 2015-2016 at 2.4%, but slower real growth in 2017-2018 at 0.4% vs. 1.7% in 2015-2016.

Prior to the election, Trump proposed "Seven actions to protect American workers" in his first 100 days through his Contract with the American Voter. As of April 2017 (after 100 days) CNN reported that he had fulfilled three of seven. Three others were fulfilled thereafter:

1. Renegotiate NAFTA: Signed the USMCA trade agreement with the leaders of Mexico and Canada. Fulfilled on November 30, 2018.

2. Withdraw from Trans Pacific Partnership (TPP): Fulfilled by April 2017.

3. Label China a currency manipulator: Fulfilled by August 2019.

4. Direct study to identify foreign trading abuses: Fulfilled by April 2017 (study begun).

5. Lift restrictions on $50 trillion worth of energy reserves: Unfulfilled as of April 2017. However, the Tax Cuts and Jobs Act will open additional land for development. In early January 2017, the Trump Administration also reversed an Obama ban on offshore drilling in a significant portion of U.S. coastal waters.

6. Lift restrictions on infrastructure projects (Keystone pipeline): Fulfilled by April 2017.

7. Cancel payments to U.N. for climate change programs: Unfulfilled as of April 2017. While the overall U.N. budget was cut for 2018-2019, this is routine and it was unclear how much the U.S. contribution would be reduced as of December 2017, despite confusing press releases from the Trump Administration.

As part of the Contract with the American Voter, Trump also pledged to impose tariffs to discourage companies from laying off workers or relocating to other countries, through an "End the Offshoring Act". While such an Act was not passed, President Trump began implementing a series of tariffs in January 2018.

Economic growth as measured by real (inflation-adjusted) GDP increased from an average of 2.4% in President Obama's last three years (2014-2016) to 2.5% through President Trump's first 3 years (2017-2019). CBO estimated that GDP cumulatively would be 0.3% higher by the end of 2018 due to the Tax Cuts and Jobs Act. A quarterly growth rate to generate a 0.3% higher cumulative total is about 0.07% per quarter.

CBO estimates real potential GDP, a measure of what the U.S. economy can sustainably produce at full employment. CBO forecast in April 2018 that from 2018-2027, real potential GDP growth would average 1.8%. Amounts above this threshold for short periods may be driven by economic stimulus (debt additions) such as the Tax Cuts and Jobs Act or unusual events such as activity to avoid tariffs. The June 2019 Federal Reserve median forecast was for full year real GDP growth of 2.1% in 2019, 2.0% in 2020, and 1.8% in 2021.

The Bureau of Labor Statistics estimates the contribution to GDP of its different components. Federal government spending did not contribute meaningfully to real GDP growth on average from 2014-2016, indicating neutral fiscal policy (i.e., no stimulus). However, from 2017-2019 it contributed about 0.2% (0.2 percentage points) to the growth rate on average each year, reflecting President Trump's stimulative deficit increases from the Tax Act and additional spending.

National Economic Council director Larry Kudlow asserted on June 29, 2018, "they've been saying that all along, OK? We could never get to 3% growth ... It couldn't be done, they say. It's being done." Trump made a similar remark the previous day. However, analysts have actually said that 3% sustained growth was unlikely, rather than periodic quarters of growth of 3% or more. The final figure for first quarter 2018 GDP growth was released the day before Kudlow spoke-coming in at 2.0% (before later revision to 2.2%).

Infrastructure, inflation, and energy

On January 24, 2017, President Trump signed presidential memoranda to revive both the Keystone XL and Dakota Access pipelines. The memorandum is designed to expedite the environmental review process.

On February 12, 2018, President Trump released his $1.5 trillion federal infrastructure plan during a meeting with several governors and mayors at The White House. Congress showed little enthusiasm for the plan, with The Hill reporting, "President Trump's infrastructure plan appears to have crashed and burned in Congress."

Trends in inflation rates over the 2016-2018 period vary depending on whether volatile food and energy prices are included in the measure:

Inflation measured by the consumer price index for all items rose from 1.3% in 2016 to 2.1% in 2017 and 2.5% year-to-date (YTD) June 2018. This was mainly driven by higher energy prices.

Core inflation, which excludes volatile food and energy prices, was relatively flat, at 2.2% in 2016, 1.8% in 2017, and 2.1% YTD June 2018.

In May 2018 Trump ordered the Department of Energy to conduct unprecedented intervention in energy markets to protect the coal and nuclear industries from competitive market pressures. Robert Powelson, whom Trump appointed to the Federal Energy Regulatory Commission, testified to the Senate Energy and Natural Resources Committee on June 12, 2018, that "unprecedented steps by the federal government - through the President's recent directive to the Department of Energy to subsidize certain resources - threaten to collapse the wholesale competitive markets that have long been a cornerstone of FERC policy. This intervention could potentially "blow up" the markets and result in significant rate increases without any corresponding reliability, resilience, or cybersecurity benefits."

The Trump administration initiated regulatory relief for the coal mining industry, particularly by moving to repeal the Clean Power Plan (CPP). A 2019 projection by the Energy Information Administration estimated that coal production without CPP would decline over coming decades at a faster rate than indicated in the agency's 2017 projection, which had assumed the CPP was in effect.

Through October 2020, coal-fueled electricity generating capacity declined faster during Trump's presidency than during any previous presidential term, falling 15% with the idling of 145 coal-burning units at 75 power plants. An estimated 20% of electricity was expected to be generated by coal in 2020, compared to 31% in 2017.

During his Inaugural Address in 2017, President Trump stated his " America First" strategy, which included the goals of reducing the trade deficit and bringing back manufacturing jobs off-shored to other countries such as China and Mexico. During his campaign and throughout his Presidency, Trump described his belief that the trade deficit was a drain on American wealth, and that trade deals such as NAFTA (1994) and the pending Trans-Pacific Partnership were damaging to the American economy and workers. He pledged to act in a way to benefit American workers first.

As of June 2019, Trump had signed consequential revisions to NAFTA known as the United States-Mexico-Canada Agreement, which were pending ratification.

In a November 10, 2015 Republican debate, Trump stated the bi-partisan, 12-nation Trans-Pacific Partnership (TPP) was "a deal that was designed for China to come in, as they always do, through the back door and totally take advantage of everyone." Politifact rated this assertion "Pants On Fire," while the conservative Wall Street Journal editorial board wrote, "It wasn't obvious that [Trump] has any idea what's in [TPP]". Trump stated similar rhetoric about TPP on June 26, 2016, which the Washington Post factchecker found to be incorrect. President Trump abandoned TPP during his first week in office through an executive order. This decision was a component of his "America First" strategy and signaled a change from long-term Republican orthodoxy, that expanding global trade was good for America and the world. The TPP was to create complex trade rules between 12 countries, to create an economic competitor to a rising China. The move was criticized as an opportunity for China to expand its influence in Asia. However, on April 13, 2018, Trump said the United States could rejoin the TPP.

TPP, renegotiated and renamed as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) after the U.S. withdrawal, became effective on December 30, 2018. Investment bank HSBC noted that 90% of tariffs on goods were immediately eliminated by the six countries that had already ratified the agreement. The other five countries were expected to ratify the agreement within months. U.S. Wheat Associates President Vince Peterson had said earlier in December that American wheat exporters could face an "imminent collapse" in their 53% market share in Japan. Peterson added, "Our competitors in Australia and Canada will now benefit from those [CPTPP] provisions, as US farmers watch helplessly." The National Cattlemen's Beef Association stated that exports of beef to Japan, America's largest export market, would be at a serious disadvantage to Australian exporters as their tariffs on exports to Japan would be cut by 27.5% during the first year of CPTPP. The Trump administration later sought a unilateral trade agreement with Japan that would increase American agricultural exports, but in April 2019 Japan rejected greater access to its markets.

On January 15, 2020 the U.S. and China entered into an agreement referred to as the "Phase One" trade deal. Reuters summarized the deal as follows:

In January 2020, the Congressional Budget Office (CBO) explained how tariffs reduce U.S. economic activity in three ways: 1) Consumer and capital goods become more expensive; 2) Business uncertainty increases, thereby reducing or slowing investment; and 3) Other countries impose retaliatory tariffs, making U.S. exports more expensive and thus reducing them. CBO summarized the economic impact of Trump's tariffs as follows:

The New York Times reported in June 2019 that If Trump's tariffs are fully implemented as proposed, they would raise prices sufficiently to offset most or all of his tax cuts for lower- and middle-class households, potentially slowing the economy. Analysis by the Tax Foundation found that the benefits of the Trump tax cut would be completely eliminated for all taxpayers through the 90th percentile in earnings. Economists at the Federal Reserve Bank of NY estimated that tariffs implemented as of May 2019 cost the average family about $415 per year, while implementing the remaining threatened tariffs would bring the total to $830 per year.

The U.S. farm industry was adversely impacted by China canceling or delaying imports of soybeans and other products in retaliation for U.S. tariffs. In response, President Trump increased farm subsidies by an estimated $28 billion in a bailout attempt, over twice the $12 billion net cost of the 2009 automotive bailout. Much of these funds go to large corporations. Farmers are one of Trump's strongest constituencies, with 67% support.

The overall trade deficit increased in both of Trump's first two years in office, up 10% in 2017 and 13% in 2018, compared to single-digit increases during each of the preceding three years. The deficit in goods, Trump's preferred trade balance measure, increased 8% in 2017 and 10% in 2018, reaching a record high of $891 billion in 2018. The goods deficit with China reached a record high for the second consecutive year in 2018, up 12% from 2017. The overall deficits were mitigated somewhat by surpluses in services, continuing a trend of many years.

Economists at the Federal Reserve Bank of St. Louis explained that a trade deficit is not necessarily bad for an economy. In one sense, a trade deficit is a subtraction from GDP, so in theory a larger trade deficit offsets economic growth and reduces the number of jobs. On the positive side, a trade deficit can mean: 1) Foreigners are net investors in your country's economy and production capacity; and 2) The economy is doing sufficiently well such that your citizens are importing more from abroad than they are exporting because local demand cannot meet supply. On the negative side, if the inflow of foreign capital is used instead to bid up housing and financial asset prices (as was the case during the United States housing bubble that contributed to the Great Recession) then a trade deficit can be detrimental. In other words, it depends on how the inflow of foreign capital is used. More generally, a CBO study explained that the best way to reduce a trade deficit was not through trade policy, but through policies that address national saving and investment, such as reducing the federal budget deficit (i.e., increasing national saving).

The following table summarizes the U.S. balance of trade (Exports - Imports, with a negative balance indicating a trade deficit) for 2017-2019. The trade deficit increased in 2017 and 2018, then slightly fell in 2019.

Manufacturing employment peaked in June 1979 at 19.6 million and remained in a range of about 16-18 million until early 2001, when it began a steep decline that roughly coincided with China's entry into the World Trade Organization in December 2001. This downward trend hit bottom in March 2010 at 11.5 million following the Great Recession. An estimated 1-2 million of the job losses in manufacturing 1999-2011 were due to competition with China (the China shock). The Economic Policy Institute estimated that the trade deficit with China cost about 2.7 million jobs between 2001 and 2011, including manufacturing and other industries. Economist Paul Krugman argued in December 2016 that "America's shift away from manufacturing doesn't have much to do with trade, and even less to do with trade policy," meaning a shift towards service employment and automation. He also cited the work of other economists indicating that the declines in manufacturing employment from 1999 to 2011 due to trade policy generally and trade with China specifically were "less than a fifth of the absolute loss of manufacturing jobs over the period" but that the effects were significant for regions directly impacted by those losses. In contrast to the China situation, manufacturing employment increased for several years following the adoption of NAFTA in early 1994, indicating it had little or no manufacturing jobs impact in total.

Analysis published by The Wall Street Journal in October 2020 found the trade war Trump initiated in early 2018 did not achieve the primary objective of reviving American manufacturing, nor did it result in the reshoring of factory production.

The Economist reported in February 2020 that strong nominal wage gains experienced by lower-paid workers in 2019 may be due in part to restrictions on immigration, along with the low unemployment rate giving workers more bargaining power, and significant increases in state-level minimum wages over several years. However, nominal wages are increasing in many rich countries, even those with growing foreign-born populations. Further, the article cautioned: "As America ages, it will need a lot more people willing to work in health care. Study after study finds a positive association between immigration and long-run economic growth-and therefore, ultimately, the living standards of all Americans. The Trump Administration's immigration [restrictions] may achieve a temporary boost in wages of the low-paid now, but at a cost to the country's future prosperity."

Among the employed, the share of foreign-born workers increased from 17.0% in December 2016 to a peak of 17.8% in February 2019, before falling to 17.2% in January 2020. Among the civilian noninstitutional population the share of foreign-born persons rose from 16.3% in December 2016 to peaks of 16.9% in March of 2018 and 2019, before falling to 16.3% in January 2020. The Economist also reported that: "For the first time in half a century America's immigrant population appears to be in sustained decline, both in absolute terms and as a share of the total."

Deregulation refers to either removing or limiting government regulations of a market. President Trump and other Republicans believe that some U.S. markets are over-regulated. However, the U.S. ranks high on the world scale of regulatory freedom, ranking 17th (mostly free) out of 169 countries on the 2017 Heritage Foundation freedom index and sixth out of 143 countries on the 2016 Cato Institute freedom index, meaning the U.S. markets are relatively unregulated compared to other countries. It is arguable whether additional deregulation would be beneficial. For example, regulations or anti-trust action that address monopoly or oligopoly conditions can improve competition in a market, lowering prices and expanding output and employment.

A report released in February 2018 by the Trump administration Office of Management and Budget (OMB) analyzed 137 "major" federal regulations (those with $100 million or more in economic impact) from FY2007 through FY2016, a period that encompasses all but the last four months of the Obama administration. According to OMB calculations, in constant 2015 dollars the overall economic benefits far outweighed the economic costs, with aggregate benefits ranging from $302 to $930 billion, while aggregate costs ranged from $88 to $128 billion. Overall, the lowest estimate of regulatory benefits exceeded the highest estimate of regulatory costs by a ratio of 2.3X. Among the department/agency regulations that were evaluated, the largest ratio of lowest estimated benefits to highest estimated costs was 3.0X for the EPA, which the Trump administration has targeted for particularly aggressive regulatory rollback under administrator Scott Pruitt. Journalist David Roberts wrote in Vox in March 2018 that: "According to OMB - and to the federal agencies upon whose data OMB mostly relied - the core of the Trumpian case against Obama regulations, arguably the organizing principle of Trump's administration, is false." Rolling back Obama-era regulations can cost money, rather than save it, and there was no discernible job impact.

The QuantGov project at the Mercatus Center tracks the count of federal regulations containing restrictive terms such as "shall," "prohibited" or "may not." Their data indicate that such regulations increased 0.7% in calendar 2017, compared to 1.1% in 2016 and 0.1% in 2015, and compared to an average of 1.4% over the preceding 20 years.

According to the nonpartisan Institute for Policy Integrity, through the middle of the Trump administration's fourth year about 10% of its deregulatory efforts had been upheld by courts, compared to an average of 70% during previous Republican and Democratic administrations.

Trump announced the U.S. would leave the Paris Agreement on June 1, 2017. Under the Agreement, each country determines, plans and regularly reports its own contribution and targets for mitigating global warming. There is no mechanism to force a country to set a specific target by a specific date, but each target should go beyond previously set targets. As of November 2017, 195 UNFCCC members have signed the agreement, and 170 have become party to it.

President Trump began efforts to loosen regulations imposed on financial institutions under the Dodd-Frank Act, which was implemented following the 2007-2008 subprime mortgage crisis. The president also installed budget director Mick Mulvaney to lead the Consumer Financial Protection Bureau established by Dodd-Frank. Mr. Mulvaney had been a "staunch opponent" of the Agency's past history of broad regulations. President Trump tweeted on November 25, 2017, that "Financial institutions have been devastated and unable to properly serve the public" even though commercial banks generated a record level of profit of $157 billion in 2016, lending activity was robust, and bank stocks were in record territory. The Trump administration and others have asserted that excessive financial regulation since 2008 has caused banks, particularly smaller banks, to decline in numbers. However, the FDIC has noted that "Consolidation in the U.S. banking industry is a multidecade trend that reduced the number of federally insured banks from 17,901 in 1984 to 7,357 in 2011" and this trend has continued through 2017.

The Republican-controlled House passed the Financial CHOICE Act, an expansive rollback of the Dodd-Frank Act, on June 8, 2017. A less aggressive bill was approved by the Republican-controlled Senate on March 14, 2018. The House approved the Senate measure on May 22, 2018.

The Federal Communications Commission (FCC) voted to repeal net neutrality regulations (the Open Internet Order) on December 14, 2017. This is expected to reduce the regulation of broadband (telecom) companies (such as AT&T and Comcast) that connect consumers' homes to the internet, essentially no longer regulating them as utilities. These providers tend to have little competition in a geographic area. Advocates and critics argued whether the move would help or hurt consumers and how it would shift market power between broadband providers and content providers (e.g., Netflix). This reversed a 2015 decision by the FCC.

President Trump cut statutory corporate tax rates from 35% to 21% effective January 1, 2018 as part of the Tax Cuts and Jobs Act. Anticipation of these cuts and a deregulatory regime significantly boosted the stock market in 2017. Federal corporate income tax revenues fell from $300 billion in fiscal year 2017 to $200 billion in fiscal year 2018, a roughly 30% decline, with significant increases in after-tax corporate profits and stock buybacks. However, 2018 stock market performance was adversely impacted by several increases in interest rates by the Federal Reserve, which did so to limit or avoid inflation caused by the stimulus effects of the Trump tax cuts, with the stock market falling nearly 20% from its peak in December 2018. The U.S. Federal Reserve then reversed course in 2019 and both cut rates and resumed expanding its balance sheet, boosting the stock market despite uncertainty created by Trump's trade policies.

During March 2020, the Dow Jones Industrial Average entered a bear market, closing down over 20% from its most recent peak on February 12, 2020. Analysts primarily blamed the COVID-19 pandemic. The U.S. stock market had grown consistently since its low point in March 2009, arguably the longest "bull market" in U.S. history.

Comparing stock market (S&P500) cumulative returns by President for their first 782 trading days (for Trump, through February 28, 2020), Trump was up +30%, Obama +70%, G.W. Bush −14%, Bill Clinton +52%, H.W. Bush +44% and Ronald Reagan +18%. The stock market (S&P500) was up a cumulative 45% through Trump's first three years as of late December 2019, versus 53% for Obama and 57% for Clinton. The stock market, as measured by the S&P 500, increased 19.4% in 2017, lost 6.3% in 2018, and gained 28.9% in 2019. Results in recent years included: 2013 +30%; 2014 +11%; 2015 -1%; and 2016 +10%. The 2018 result was the worst since 2008.

However, about half of Americans did not participate in this 2009-2020 bull market. In March 2017, NPR summarized the distribution of U.S. stock market ownership (direct and indirect through mutual funds) in the U.S., which is highly concentrated among the wealthiest families, with the bottom 80% owning only 8% of stocks. Further, more than one-third of Americans who work full-time have no access to pensions or retirement accounts such as 401(k)s that derive their value from financial assets like stocks and bonds. The NYT reported that the percentage of workers covered by generous defined-benefit pension plans has declined from 62% in 1983 to 17% by 2016. While some economists consider an increase in the stock market to have a "wealth effect" that increases economic growth, economists like Former Dallas Federal Reserve Bank President Richard Fisher believe those effects are limited.

Household net worth is the sum of financial, real estate, and business assets (non-corporate), less liabilities. In nominal terms (not adjusted for inflation) it declined in 2008 due to the Great Recession but resumed steadily rising in 2009 and reached its sixth consecutive annual record high in 2017. This was primarily driven by stock market increases, although housing price increases also contributed. The $100 trillion level was reached in Q1 2018, which is approximately $800,000 per household on average. However, the median (50th percentile) family had $100,000 net worth in 2016, an indicator of the dramatic wealth inequality in the U.S.

Real median household income continued in record territory under President Trump, as indicated in the table below, although the rate of increase slowed. The Council of Economic Advisers had estimated in October 2017 that the corporate tax cut of the TCJA would increase real median household income by $3,000 to $7,000 annually, but during the first year following enactment of the tax cut the figure increased by $553, which the Census Bureau characterized as statistically insignificant.

In its annual Report on the Economic Well-Being of U.S. Households released on May 22, 2018, the Federal Reserve found that 74% of surveyed adults were either "doing okay" or "living comfortably" in 2017, up from 70% in 2016, the fourth consecutive increase since the Fed first asked that survey question in 2013.

Gas prices rose from $2.34/gallon in May 2017 to $2.84 in May 2018, cutting into the tax cut savings. Economist Mark Zandi stated: "If the 50-cent per gallon increase in gas prices remains, it would cost the average American $450 a year, offsetting about half the tax [cut] benefit." President Trump's withdrawal from the Iran nuclear deal was one factor in the increase in gas and oil prices, along with quotas established by OPEC in the face of an economy growing worldwide.

The share of income going to the top 1% has doubled, from 10% to 20%, since the pre-1980 period, while the share of wealth owned by the top 1% has risen from around 25% to 42%. Despite President Trump promising to address those left behind, the Tax Cuts and Jobs Act would make inequality far worse:

The Tax Policy Center estimated that the bottom 80% of taxpayers (income under $149,400) would receive 35% of the benefit in 2018, 34% in 2025 and none of the benefit in 2027, with some groups incurring costs.

Sizable corporate tax cuts would flow mostly to wealthy executives and shareholders;

In 2019, a person in the bottom 10% would average a $50 tax cut, while a person in the top 1% gets a $34,000 tax cut;

Up to 13 million persons losing health insurance or subsidies are overwhelmingly in the bottom 30% of the income distribution;

The top 1% receives approximately 70% of the pass-through income, which will be subject to much lower taxes;

Rolling back the estate tax, which only impacted the top 0.2% of estates in 2016, is a $150 billion benefit [Note: The final version of the tax law reduced this to $83 billion] to the ultra-rich over 10 years.

The top 1% of households own 40% of stocks; the bottom 80% just 7%, even when including indirect ownership through mutual funds.

In 2027, if the tax cuts are matched by spending cuts borne evenly by all families, after-tax income would be 3.0% higher for the top 0.1%, 1.5% higher for the top 10%, -0.6% for the middle 40% (30th to 70th percentile) and −2.0% for the bottom 50%.

The NYT reported in July 2018 that: "The top-earning 1 percent of households-those earning more than $607,000 a year-will pay a combined $111 billion less this year in federal taxes than they would have if the laws had remained unchanged since 2000. That's an enormous windfall. It's more, in total dollars, than the tax cut received over the same period by the entire bottom 60 percent of earners." This represents the tax cuts for the top 1% from the Bush tax cuts and Trump tax cuts, partially offset by the tax increases on the top 1% by Obama.

In December 2019, CBO forecast that inequality would worsen between 2016 and 2021, due in part to the Trump tax cuts and policies regarding means-tested transfers. Their report had several conclusions:

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Economic policy of Donald Trump administration

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The economic policy of the Donald Trump administration is characterized by individual and corporate tax cuts, attempts to repeal the Patient Protection and Affordable Care Act ("Obamacare"), trade protectionism, immigration restriction, deregulation focused on the energy and financial sectors, and responses to the COVID-19 pandemic.

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I'm saying that Americans can pay more taxes. They have a lot of money.

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i agree with what othniel said because if the government tax the wealthy more than 50 percent than they will probably be loose motive to work because no one would want to work and know that what they earn is mostly for the government  .

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I don't think that just because they have more money they should have to pay more taxes. OFC not everybody starts out the same and people have privilege, but if i worked hard to get my money and i end up the same regardless then I would rather just be poor if we end up the same anyways.

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Even if you pay more taxes it doesn't mean that you;re becoming poor,. You're still earning more than other people. You'd still rather be rich than poor

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Actually, the GDP has grown under trump. Not saying that i love him im just saying that the debt increased, but the overall economy has grown.

https://www.whitehouse.gov/articles/united-states-gdp-growth-continues-exceeding-expectations/

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President Clinton raised the top marginal income tax rate from 31 to 39.6 percent and saw GDP growth top 4 percent every year in his second term.

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This story is part of a group of stories called

Finding the best ways to do good.

The 1990s Democratic Party made friends with the rich. The 2008 Democratic Party was eager to bail them out. The 2019 Democratic Party seems ready to declare war.

In just the past few months, at least three major Democratic Party figures, two of whom are presidential contenders, have proposed large tax increases targeted at the richest Americans:

Rep. Alexandria Ocasio-Cortez (D-NY) floated a big increase in top marginal income tax rates in an interview on 60 Minutes. Sen. Elizabeth Warren (D-MA) proposed an annual wealth tax. Sen. Bernie Sanders. (I-VT) proposed a drastic hike in the estate tax.

The Democratic urge to tax the rich isn't a wholly new development. In the 2016 general election, Hillary Clinton embraced Sanders's proposal for a 65 percent top estate tax rate, and both Bill Clinton and Barack Obama were able to raise the top income tax rate by a few points.

But Sanders, Warren, and Ocasio-Cortez's proposals are significantly more ambitious; Warren, for instance, is proposing a kind of tax the federal government has never imposed before, breaking totally new ground.

Right now these are somewhat disjointed proposals that don't add up to a coherent picture of how the tax system ought to look; Ocasio-Cortez's, especially, was dashed off in the course of an interview (though it got debated as if it were a carefully constructed white paper).

But over the 2020 primary and in the new majority-Democratic House, we should expect these ideas to start to harden into a broader agenda for dramatically raising rates on top earners.

At the end of the process, the Democratic Party is likely to wind up with a much more aggressive party consensus on taxes than has prevailed since the 1980s.

This isn't a change that came out of nowhere. It comes out of a growing dissatisfaction with the timidity of Democratic efforts to tax the rich in the Clinton and Obama eras, and a growing intellectual trend in economics that has given a sound theoretical basis to tax plans that soak the rich.

But it's not a trend that's necessarily going to be easy to translate into policy. There are some important questions to sort out: What tax rate should we apply to the richest to maximize revenue? What rate is so high that it begins to discourage work - and the government gains less revenue? How feasible is a tax on wealth (as opposed to income), and what obstacles stand in the way? These and many other details need to be reckoned with as Democrats begin to think about turning campaigning into real policy.

The Democratic proposals to tax the rich

Before we get into it, let's recap the basic plans - or loosely sketched ideas - for taxing the rich currently on offer from prominent Democrats:

Rep. Alexandria Ocasio-Cortez (D-NY) suggested a top rate of 70 percent on incomes over $10 million, which would actually be somewhat below prevailing rates under Dwight Eisenhower, and around where top rates were from Lyndon Johnson to Jimmy Carter.

Warren's plan would set up a progressive wealth tax, with a normal rate of 2 percent on wealth over $50 million and a top rate of 3 percent on wealth over $1 billion. That might sound small, but because it's levied on wealth, not income, and every year rather than at death, it could wind up hitting billionaires harder than high income or estate taxes.

Sanders's plan would raise the top estate tax rate to 77 percent. That's the same top rate that existed from 1941 to 1976; this is higher than the 65 percent top rate he proposed in the 2016 race.

Sen. Cory Booker (D-NJ) has proposed a 65 percent estate tax rate (higher than at any point since 1982), a higher capital gains tax rate, and applying capital gains taxes to assets held at death, all to pay for his baby bonds bill.

Rep. Jan Schakowsky (D-IL), a lefty House Democrat who's been proposing a top income tax rate of 49 percent since at least 2011, says she's working with Ocasio-Cortez to formulate a new bill that might feature even higher top rates.

And if Sanders excitedly releasing his estate tax plan after Warren's wealth tax proposal is any indication, the 2020 race will involve a leftward arms race as candidates attempting to court voters worried about income inequality try to one-up each other's plans to tax the rich.

A recent history of taxing the rich

High tax rates targeting the rich used to be the norm in the United States. As recently as 1963, the top income tax rate was 91 percent, a rate that persisted, plus or minus a point or two, from World War II through Truman and Eisenhower and the early Kennedy years.

A mere quarter-century later in 1988, the top rate had toppled to 28 percent. How'd they get there?

Both parties played a role. First, under across-the-board tax cuts backed by John F. Kennedy and signed by Lyndon B. Johnson in 1964, the top rate fell to 70 percent. Then Ronald Reagan's 1981 tax cuts slashed top rates for both the income and estate tax - the former down to 50 percent, the latter to 55 percent by 1984. Finally, a bipartisan coalition in Congress, along with Reagan, put together the 1986 tax reforms, which cut back on a number of major income tax deductions but also took the top rate down to 28 percent.

A desire to slash deficits led George H.W. Bush to conclude that a 28 percent top rate was infeasibly low, prompting him to boost it to 31 percent when he famously violated his "no new taxes" pledge in 1990. Shortly after taking office in 1993, Bill Clinton added 36 percent and 39.6 percent brackets.

Fights over the top income tax rate ever since have taken place in a very narrow band between 35 and 39.6 percent. George W. Bush cut it to 35 in 2001; Obama forced House Republicans to agree to restore it to 39.6 percent in late 2012; Donald Trump and his congressional allies brought it back down to 37 percent in 2017.

The Affordable Care Act did include a small 0.9 percent surtax on wages for wealthy individuals, which put their effective top rate (including the existing 2.9 percent Medicare payroll tax) at 43.4 percent by the time Obama left office; Trump's tax cuts took that number down to 40.8 percent.

The estate tax has seen a similar trajectory, stagnating at 55 percent between the first Reagan tax cuts and George W. Bush. The 2001 tax cuts then set it on course to be totally abolished - and it was for one year, 2010, a truly great year for rich people to die in - only to see it resurrected with lower top rates (35 percent and 40 percent) after the 2010 and 2012 budget battles.

Obama proposed other measures to increase taxation on top earners that Congress never gave a hearing, but they were modest compared to the ideas that Sanders, Ocasio-Cortez, and Warren are floating now. His two principal ideas were the "Buffett Rule" - a minimum tax rate of 30 percent for people with $1 million-plus in income, inspired by Warren Buffett - and a cap on itemized deductions and exclusions. The Buffett Rule would've dramatically increased the tax rate on investment income, but only to the mid-30s range. Neither plan would've raised the top rate on wage income to anything like its historic highs.

Obama certainly wanted to increase taxes on the rich more than he did. But even his most ambitious proposals were not really scaled to substantially cut inequality or raise a huge amount of revenue. The new generation of Democratic proposals are.

The intellectual basis for taxing the rich

So what accounts for the new aggressive support for taxing the rich among leading Democrats? There's the Great Recession, in which bankers were bailed out as high unemployment persisted for years; and the Occupy movement, which made economic inequality a core national issue in 2011 and onward.

But an important intellectual precondition was the work of a handful of French economists focusing on distributional issues. Berkeley's Emmanuel Saez and the Paris School of Economics' Thomas Piketty have been using tax records to analyze income inequality for decades now, but a handful of publications by them and collaborators in recent years made high marginal rates intellectually respectable.

Is 73 percent the magic number?

One paper in particular looms large here. In 2012, Saez and Peter Diamond, an MIT professor who had recently won the Nobel in economics, released "The Case for a Progressive Tax," which estimated that the optimal top tax rate in the US - the rate that maximizes both revenue and the welfare of Americans - is about 73 percent. That's much higher than the top rate in the US, even taking into account state and local taxes in high-tax places like California and New York.

Saez and Diamond's calculation relied on the idea of diminishing marginal utility - rich individuals benefit less from additional money than low- or middle-income people do - and on their estimation that top earners aren't very responsive to top tax rates.

The 73 percent figure relies on a "mid-range estimate" of the elasticity of income in response to taxation for the rich that is quite low (0.25). Elasticity measures how much one factor (in this case, the income earned by the rich) changes in response to another (in this case, the tax rate). In this instance, low elasticity means raising taxes on the rich would cause them to work less and hurt economic growth - but not by that much, and that effect is easily outweighed by the benefits of higher tax revenue spent to benefit the non-rich through welfare state programs.

Economists who dispute the Saez-Diamond result tend to argue that 0.25 is too low of an elasticity estimate, and that a top rate in the realm of 73 percent would significantly reduce the rich's work effort. A recent paper, for instance, argued that the revenue-maximizing rate is more like 49 percent, when you take into account the prospect that high tax rates could discourage young people from developing economically useful skills.

Capital: to tax or not to tax

Saez and Diamond also argued that capital income - income from things like capital gains, corporate profits, dividends, etc. - should be taxed, which broke with previous models of optimal tax theory. (Our current capital gains top rate is 23.8 percent.) Those models had suggested the proper tax rate on capital income was zero, on the grounds that it discouraged savings: If you spend money on an investment, your profits are taxed, but if you spend money on food or a house or what have you, you don't get hit with a capital tax - so a capital tax's presence pushes you to spend more and save less.

But Saez and Diamond dispute whether these model findings are relevant to lived reality. If you're a lawyer with your own practice, are your billable hours capital income (profits accruing to your law firm) or wage income (earnings accruing to you)? There's ambiguity there, and taxing capital income less than labor income can thus lead to gaming. The rich have a strong incentive to reclassify labor income as capital income - the way that hedge fund and private equity managers do already using the carried interest loophole - which suggests we should tax capital income to prevent this kind of avoidance.

This argument is important for estate taxes as well, as they are also a kind of capital tax. A 2013 paper by Piketty and Saez made this argument explicitly, arguing that the optimal inheritance tax rate was something like 50 to 60 percent, and possibly even higher for the very rich.

Piketty and Saez's inheritance paper also notes that what tax rate is "optimal" depends a lot on your moral philosophy. Most optimal tax papers tend to assume a kind of crude utilitarianism: Taxes should be used to maximize the public welfare, roughly estimated, so you should only take money from the rich so long as doing so boosts overall welfare.

But maybe we don't care as much about overall welfare but instead the welfare of the worst-off. Piketty and Saez show that the optimal inheritance tax is much higher if you use a "Rawlsian" social welfare function, where the goal is for taxes to maximize the interests of the worst-off, not of everyone.

Piketty also, of course, promoted a specific kind of capital tax in his best-seller Capital in the 21st Century: a tax on accumulated wealth, with top rates of 2 percent or more. It's no coincidence that Saez and his Berkeley colleague Gabriel Zucman, who both work closely with Piketty, advised Warren on her proposal for a wealth tax topping out at 3 percent. In the context of Piketty's book, the wealth tax is meant to prevent the permanent intergenerational accumulation of wealth, which he argues will be inevitable due to the rate of interest on capital exceeding the rate of economic growth (his famous r > g claim).

Wage bargaining and the "third elasticity"

The last key component of this literature is a paper by Piketty, Saez, and Harvard professor Stefanie Stantcheva, which introduced the idea of a "third elasticity."

The first elasticity in their model is the one described above, representing the effect of top tax rates on the work effort of top earners. Maybe Apple CEO Tim Cook would be less likely to pursue new projects in search of a big bonus if he thought that 70 to 80 percent of that bonus would be confiscated. They argue this elasticity is fairly small, in the 0.2 to 0.25 range, in keeping with Saez's article with Diamond.

The second elasticity is the elasticity of avoidance: how much tax dodging increases as tax rates go up. Piketty, Saez, and Stantcheva argue that this elasticity is even smaller.

The third elasticity is where the real action is. High tax rates, the authors note, do not merely reduce work effort and increase tax avoidance; they also decrease wage bargaining. When people like Cook's tax rate is low, they have a strong incentive (as do other top Apple executives) to fight for increased compensation for themselves where possible. But when top tax rates are high, they're less likely to fight as hard, and more likely to use that money to pay workers in lower tax brackets, invest, etc.

Bargaining effects like these, Piketty, Saez, and Stantcheva argue, are bigger than the effects on actual work effort. By reducing bargaining like this, high income tax rates actually perform a social good. That implies the top tax rate could be very high indeed - their preferred parameters result in a top rate of 83 percent.

All of this adds up to a comprehensive intellectual case for the proposals that Ocasio-Cortez, Sanders, and Warren are floating: much higher income and estate tax rates, and perhaps an annual wealth tax as well.

The ideas of the French school of inequality economics are controversial within the profession. Plenty of tax economists on the center and right tend to believe top rates are worse for growth than Saez et al. conclude, and that taxes on investment are especially costly. In particular, many doubt that there's a solid empirical basis for the idea of a third elasticity.

But while top rate skepticism was once the dominant view within economics, the French school has shown that it's possible to defend much, much higher rates, including on capital income, using fairly standard methods and empirical evidence.

Why taxing the rich can be hard in practice

So let's say you buy the French school evidence. Time to all get on board higher income, estate, and wealth taxes, right? Maybe - but there are some practical complications worth sorting out first.

The US obviously knows how to levy very high taxes on rich people's wage income. But capital income is trickier. After the income tax was first adopted in the 1910s, capital gains were initially treated as regular income and taxed at the same rate. But that quickly changed, and from 1921 onward, the top rate on capital gains never exceeded 40 percent, and was often quite a bit lower than that.

There are two major reasons for that. The first is fear of the negative effects on savings of high capital gains rates. But arguably more important was fear of "lock-in." Because capital gains taxes are only levied when an asset is sold, very high rates on capital gains can lead investors to simply not sell stocks at all for long periods. That, among other issues, reduces federal revenue.

NYU tax law professor David Kamin has a great paper, simply titled "How to Tax the Rich," explaining some of the difficulties here. Right now the top capital gains rate is 23.8 percent. But because of lock-in, the revenue-maximizing rate for capital gains is more like only 28 to 32 percent, according to the Joint Committee on Taxation (JCT) and the Treasury Department (as summarized by Kamin) - not too much higher than the current top rate. Some economists argue that JCT and Treasury are too pessimistic, but as JCT will be scoring any bill raising capital gains rates, its verdict is the one that matters.

Kamin estimates that you could get, at most, $10 billion to $15 billion more a year from raising capital gains rates to their revenue-maximizing rates, and another $10 billion from treating dividends like regular income. That's not chump change, but in terms of the federal budget, it's not a whole lot either.

To get around the problem of "lock-in," you'd want to move to something called a "mark-to-market" capital tax. Instead of only taxing gains on assets when they're sold, you'd tax gains based on the assets' estimated value every year, even if the stocks in question are just sitting in a Vanguard account. That approach would allow for much higher rates on capital gains - but it would be a huge reform, and perhaps difficult to achieve.

Wealth taxes face an even bigger hurdle in the form of Article I, Section 9, Clause 4 of the Constitution:

No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.

Helpfully, the Constitution does not define what a "direct tax" is. But as UChicago's Daniel Hemel explains, it's often assumed to include land taxes, and before the 16th Amendment it was assumed to include income taxes as well. (The 16th Amendment enabled federal income taxes but did not expressly allow wealth or property taxes.)

That means wealth taxes might, under the Constitution, have to be "apportioned" among the states according to their populations. ("That means that if California amounts to 12 percent of the U.S. population, Californians must pay 12 percent of any direct tax  -  no more, no less," Hemel writes.)

Many legal scholars, notably including Dawn Johnsen of Indiana University and Duke's Walter Dellinger in a paper last year, believe that wealth taxes do not run afoul of the Constitution. When unveiling her wealth tax plan, Warren released letters signed by a number of constitutional and tax law experts, including Johnsen and Dellinger, Yale's Anne Alstott and Bruce Ackerman, Stanford's Pam Karlan, UChicago's Aziz Huq, and UT Austin's Calvin Johnson, arguing for the tax's constitutionality.

But some credible tax scholars on the left like Hemel think a wealth tax does raise real constitutional issues. It's also worth being much more cynical on this issue: Do you really think, in your heart of hearts, that the conservative majority of the Supreme Court will miss an opportunity to strike down a wealth tax passed by a Democratic president?

And then there are more boring logistical questions about wealth taxes: How do we locate rich people's wealth? Is it possible to value real estate accurately every year? Is the US really going to get aggressive about tax havens? These administrative issues, a recent OECD report found, have led many European countries to abandon wealth taxes in recent years.

Finally, there's estate taxation. The estate tax currently uses a principle called "step-up basis," which cuts down on the revenue it can bring in.

Here's how it works. Imagine you're living in New York in the 1980s and buy an original Basquiat painting for $200. By the time you die and leave that painting to your daughter, it's worth $40 million. If your daughter then sells it, she'll pay capital gains tax - but only on the difference between the sale price and $40 million. The tax code defines heirs' gain relative to the value of an asset when they inherit it, rather than its value when their bequeathers originally bought it. Tax Policy Center head Len Burman has called this "arguably the biggest loophole in the tax code for high-wealth households."

The Booker estate tax bill would replace this with realization upon bequest or gift. That would mean that your hypothetical daughter would pay tax on your nearly $40 million gain as soon as you died. Kamin estimates that this would raise at least $40 billion a year, in part because people currently hoarding assets until death, when the gains become tax-free, would now have a reason to sell them off early. That's good for overall economic efficiency as well.

But arguably the whole estate tax could use a restructuring. A number of tax analysts, notably NYU Law's Lily Batchelder, have proposed moving to an inheritance tax, where the living beneficiaries of an estate, rather than the deceased person's estate itself, would include inheritance money in their taxable income and perhaps pay an additional surtax on it.

All of which is to say: Democrats have gotten to the first stage in the tax-the-rich process. They're sketching out broad ideas that poll well and offer red meat to primary and caucus voters for 2020. And they haven't yet committed to approaches to handle these implementation details, like tracking wealth, taxing capital income as it's earned, and taxing inheritances rather than estates.

That's normal. The 2016 primary featured a bevy of Republicans proposing deficit-exploding tax cut plans that primarily benefited the wealthy, and ultimately Trump and congressional Republicans arrived at a tax reform that borrowed from those plans in certain structural ways but also cut top tax rates much, much less. Democratic proposals will face a similar process of loose proposals, analyst scrutiny, and legislative compromise.
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At the same time, Republicans suffered when it turned out that they couldn't get their whole party on board with key elements of tax reform that leaders like Paul Ryan considered crucial, like "border adjustment" for corporate taxes. So Democrats in Congress might benefit from sorting out the details sooner rather than later, lest they find themselves similarly flat-footed once they're in power.

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Finding the best ways to do good. The 1990s Democratic Party made friends with the rich. The 2008 Democratic Party was eager to bail them out. The 2019 Democratic Party seems ready to declare war. In just the past few months, at least three major Democratic Party figures, two of whom are presidential contenders, have proposed large tax increases targeted at the richest Americans: Rep.

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@serina & @honggi I disagree with you guys because the US is spending unnecessary amounts on things that they could’ve saved money on. For example, the US is spending around 1/3 of their military budget just for maintenance fees and they’re also keeping deserted military bases open. If they were able to close down military bases that they don’t need, then it would save a lot of money. Moreover, the maintenance fees are making it so that they have no money to conduct researches, construction, and housing. Because of the cost for maintenance, the US have actually been cutting the amounts of soldiers recruited.

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I think that the wealthy should pay more taxes then regular people with 9-5 jobs. Although they did work hard to make that money, they do still have a surplus of it. The U.S is also in debt so it would greatly benefit the government. I don't think
that anyone should be getting taxed more then 50 percent cause that would be more then their own profit.

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I think it is not a wise decision, as every country strives for peace and comfort for themselves spending all this money on military gain nothing. Although you may use military power to scare other countries into not attacking you, but the U.S has so many allies that they shouldn't even be spending that amount of money on military.