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It’s Official: Trump’s Tax Bill Is A Catastrophic Failure

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It has now been over a year since President Donald Trump signed into law the Tax Cuts and Jobs Act, a piece of government legislation that essentially slashes taxes for businesses and high earners, a bit like the opposite of Robin Hood. Since over twelve months have passed since that fateful day for the American economy, we are now in a good position to use hindsight and look back to review the effects this bill has had. And it’s not good news, folks, as you might have guessed.

There are a million different ways in which this bill has hurt American workers, so here are the highlights. Firstly, and perhaps most devastatingly of all, the tax bill has not only failed to pay for itself (as many high profile Republicans including Sen. Pat Toomey promised last year that it would on a repeated basis) but it has in fact produced a net loss for the economy. Not only that, but the loss it has produced is a massive one.

In October and November 0f 2018, the US government faced a budget deficit of $305 billion – that’s enormous, and much higher than the $202 billion it saw over the same period in the previous year (before Trump’s tax bill came into force). What’s more, according to the Congressional Budget Office (CBO) the bill will add a colossal $1.9 trillion of extra debt to the US economy over the next ten years. So much for Trump’s surging economy and President Barack Obama‘s supposedly irresponsible anti-business economic policies.

Economist William Gale was scathing in his review: “In terms of the big picture, what it’s doing is making current rich people better off at the expense of lower-income households and future generations.” Quoting former President John F. Kennedy, he said: “The time to repair a roof is when the sun is shining.”

Incredibly, it gets worse. Trump has repeatedly pointed to figures apparently showing that the US economy is booming and that the above losses and debts are a small price to pay in comparison to the benefits that will be granted to America thanks to its newfound financial strength. Even besides the terrible economics of this logic, it is fundamentally untrue. Growth has been minimal and temporary.

Any fixed investment by businesses, though it spiked a little in the first and second quarters of 2018, plateaued completely by the third quarter – six months of slightly increased investment from a few companies is clearly nowhere near enough to balance out nearly $2 trillion of national debt. And that’s not to mention the fact that big businesses have been openly taking advantage of it to dodge higher tax rates without launching any new investments at all using a sneaky technique called the “repatriation holiday”.

At this point, any remotely self-aware President who actually had the best interests of the American people at heart would admit that this bill had been a total failure, which it clearly has, try a new approach and move on. But because Trump is so convinced that the Fake News Media is conspiring against him, he simply refuses to accept these facts when they are reported, and as a result we as a country continue to plunge totally needlessly into looming economic oblivion.


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