Investing In Americas Workers And Families
Affordable and high-quality Child Care for American workers and their families.
- Doubled the Child Tax Credit from $1,000 to $2,000 per child and expanded the eligibility for receiving the credit.
- Nearly 40 million families benefitted from the child tax credit , receiving an average benefit of $2,200 totaling credits of approximately $88 billion.
- Signed the largest-ever increase in Child Care and Development Block Grants expanding access to quality, affordable child care for more than 800,000 low-income families.
- Secured an additional $3.5 billion in the Coronavirus Aid, Relief, and Economic Security Act to help families and first responders with child care needs.
- Signed into law 12-weeks of paid parental leave for Federal workers.
- Signed into law a provision that enables new parents to withdraw up to $5,000 from their retirement accounts without penalty when they give birth to or adopt a child.
Advanced apprenticeship career pathways to good-paying jobs.
- Expanded apprenticeships to more than 850,000 and established the new Industry-Recognized Apprenticeship programs in new and emerging fields.
- Established the National Council for the American Worker and the American Workforce Policy Advisory Board.
- Over 460 companies have signed the Pledge to Americas Workers, committing to provide more than 16 million job and training opportunities.
- Signed an executive order that directs the Federal government to replace outdated degree-based hiring with skills-based hiring.
Federal Corporate Income Tax Receipts
During the six months following enactment of the Trump tax cut, year-on-year corporate profits increased 6.4%, while corporate income tax receipts declined 45.2%. This was the sharpest semiannual decline since records began in 1948, with the sole exception of a 57.0% decline during the Great Recession when corporate profits fell 47.3%.
Federal corporate income tax receipts fell from about $297 billion in fiscal year 2017 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 was 1.8% GDP.
Trump’s Impact On The Us Economy
Georgia Strong | United States Fellow
As American President Donald Trumps first Presidential term comes to a close, his economic efforts can start to be fully evaluated. Broadly, Trumps economic policy was greater employment for blue collar workers, and economic growth of 4 to 6 per cent. One of the first programs implemented by President Trump when he was elected was the corporate tax cut scheme. This move likely stimulated the US economy to some extent as gross domestic product rose to 2.9 per cent for 2018. However, the long term economic benefits are wearing off as business investment has declined for the previous two quarters. By February 2020 President Trump was expected to increase the federal deficit by 74 per cent over 4 years.
To put Trumps debt in context, the US annual budget deficit was expected to approximate 4.6 per cent of GDP for 2020, as calculated in January prior to the global economic downturn. Similarly, President Trumps first three years in office all recorded a deficit exceeding 4 per cent of GDP. The only other time the US has partaken in sustained budget deficits of this magnitude is during World War II. A typical budget deficit averages 1.5 per cent of GDP when the economy exhibits relatively strong growth – as was the case in 2016 to 2019.
Georgia Strong is the United States Fellow for Young Australian’s in International Affairs.
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Waters Of The Us Rule Revocation
What are the waters of the U.S.? President Trump issued an executive order in 2017 ordering the EPA to formally review what waters fell under the jurisdiction of the EPA and Army Corps of Engineers according to the 1972 Clean Water Act. The proposed change narrowed the definition of what’s considered a federally protected river or wetland.
Tax Relief For The Middle Class
Passed $3.2 trillion in historic tax relief and reformed the tax code.
- Signed the Tax Cuts and Jobs Act the largest tax reform package in history.
- More than 6 million American workers received wage increases, bonuses, and increased benefits thanks to the tax cuts.
- A typical family of four earning $75,000 received an income tax cut of more than $2,000 slashing their tax bill in half.
- Doubled the standard deduction making the first $24,000 earned by a married couple completely tax-free.
- Doubled the child tax credit.
- Virtually eliminated the unfair Estate Tax, or Death Tax.
- Cut the business tax rate from 35 percent the highest in the developed world all the way down to 21 percent.
- Small businesses can now deduct 20 percent of their business income.
- Businesses can now deduct 100 percent of the cost of their capital investments in the year the investment is made.
- Since the passage of tax cuts, the share of total wealth held by the bottom half of households has increased, while the share held by the top 1 percent has decreased.
- Over 400 companies have announced bonuses, wage increases, new hires, or new investments in the United States.
- Over $1.5 trillion was repatriated into the United States from overseas.
- Lower investment cost and higher capital returns led to faster growth in the middle class, real wages, and international competitiveness.
Jobs and investments are pouring into Opportunity Zones.
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How Has The Us Economy Actually Performed In The Trump Era And How Much Can He Actually Legitimately Take Credit For
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Ever since he unexpectedly prevailed over Hillary Clinton in the 8 November 2016 presidential election, Donald Trump has been boasting about his achievements in boosting the US economy.
But how has the US economy actually performed in 12 months of the Trump era?
And how much can he actually legitimately take credit for?
Economic Growth Was Lackluster
Annual economic growth failed to accelerate under President Trump, denying him of his goal of 3 percent let alone 4, 5, and maybe even 6 percent growth each year. Annual economic growth averaged 2.5 percent across President Trumps first three years in office, in line with the average growth rate during President Obamas last three years. And while the economy grew by 3 percent in 2018, the best year of President Trumps term, the last time annual growth actually exceeded 3 percent was in 2015, under President Obama.
President Trumps failure to supercharge the economy is even clearer when narrowing in on his signature policy, the 2017 tax law. Economic growth in the eight quarters after the law was enacted averaged 2.4 percent, the same growth rate as in the eight quarters before the law. Notably, this growth was driven by government spending rather than by business investment or consumption, both of which slowed after enactment.
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Serving And Protecting Our Veterans
Reformed the Department of Veterans Affairs to improve care, choice, and employee accountability.
- Signed and implemented the Forever GI Bill, allowing Veterans to use their benefits to get an education at any point in their lives.
- Eliminated every penny of Federal student loan debt owed by American veterans who are completely and permanently disabled.
- Compared to 2009, 49 percent fewer veterans experienced homelessness nationwide during 2019.
- Signed and implemented the HAVEN Act to ensure that Veterans whove declared bankruptcy dont lose their disability payments.
- Helped hundreds of thousands of military service members make the transition from the military to the civilian workforce, and developed programs to support the employment of military spouses.
- Placed nearly 40,000 homeless veterans into employment through the Homeless Veterans Reintegration Program.
- Placed over 600,000 veterans into employment through American Job Center services.
- Enrolled over 500,000 transitioning service members in over 20,000 Department of Labor employment workshops.
- Signed an executive order to help Veterans transition seamlessly into the United States Merchant Marine.
We Have A Massive Jobs Crisis
Having only recouped just overhalf of the record 22 million jobs lost in March and April, the economy is still down nearly 11 million jobs since February an even deeper hole than the nearly 9 million jobs lost during the Great Recession. Yet filling this enormous gap is becoming more difficult amid rising business closures and slowing job growth. The number of jobs added in September was less than half the number added in August: if gains continued at the September pace, it would take us nearly a year and a half to return to February employment levels and more than 2 years to return to our pre-pandemic trajectory.
As payroll employment has slowed, the number of workers permanentlylaid offhas steadily crept up toward Great Recession levels, while many have left the labor force altogether. Nearly 900,000 women four times the number of men left the workforce in September alone, threatening to erode years of progress in narrowing gender pay and employment gaps. In total, 4.4 million people have left the labor force since February. Even for those Americans currently working, millions have seen cuts to their hours and pay, and millionsmore are not working from home and may be risking their health on the job.
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Trump And The Us Economy: What Can He Take Credit For
Donald Trump promised to tear up trade deals and bring back jobs to the US Rust Belt lost to globalization. Pandemic aside, the American economy has boomed since 2016, but how much is down to the president’s policies?
In the 2016 US presidential election, large swaths of working-class Barack Obama voters switched their support to Donald Trump, who campaigned on a promise to “Make America Great Again.”
Vowing to drain the Washington “swamp” that he said had sold millions of US jobs overseas, the billionaire businessman and reality TV show host struck a chord with voters, who had, for years, tolerated the offshoring of high-paying jobs, stagnant or falling wages, and rising job insecurity.
Banking And Consumer Protection
President Trump began efforts to loosen regulations imposed on financial institutions under the Dodd-Frank Act, which was implemented following the 2007â2008 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.
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The Most Important Thing Biden Can Learn From The Trump Economy
A hot economy with high deficits didnt cause runaway inflation.
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By Neil Irwin
For all the problems that President Trumps disdain of elite expertise has caused over the last four years, his willingness to ignore economic orthodoxy in one crucial area has been vindicated, offering a lesson for the Biden years and beyond.
During Mr. Trumps time in office, it has become clear that the United States economy can surpass what technocrats once thought were its limits: Specifically, the jobless rate can fall lower and government budget deficits can run higher than was once widely believed without setting off an inflationary spiral.
Some leading liberal economists warned that Mr. Trumps deficit-financed tax cuts would create a mere sugar high of a short-lived boost to growth. The Congressional Budget Office forecast that economic benefits of the presidents signature tax law would be partly offset by higher interest rates that would discourage private investment.
And the Federal Reserve in 2017 and 2018 took action to prevent the economy from getting too hot driven by models suggesting that an improving labor market would eventually cause excessive inflation.
These warnings did not come true.
Just maybe, does the success of Trumponomics tell us that weve been doing something wrong for decades?
Economic Impact Of Trade Policies
In January 2020, the Congressional Budget Office 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:
- âIn CBO’s estimation, the trade barriers put in place by the United States and its trading partners between January 2018 and January 2020 would reduce real GDP over the projection period .
- The effects of those barriers on trade flows, prices, and output are projected to peak during the first half of 2020 and then begin to subside.
- Tariffs are expected to reduce the level of real GDP by roughly 0.5 percent and raise consumer prices by 0.5 percent in 2020.
- As a result, tariffs are also projected to reduce average real household income by $1,277 in 2020.
- CBO expects the effect of trade barriers on output and prices to diminish over time as businesses continue to adjust their supply chains in response to the changes in the international trading environment. By 2030, in CBO’s projections, the tariffs lower the level of real GDP by 0.1 percent.â
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Federal Budget Shutdown Of 20182019
On December 22, 2018, the federal government went into a partial shutdown caused by the expiration of funding for nine executive departments. The lapse in funding occurred after Trump demanded that the appropriations bill include funding for a U.S.-Mexico border wall. 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. About 380,000 federal employees were furloughed, some public services were shut down, and an additional 420,000 employees for the affected agencies were expected to work with their pay delayed until the end of the shutdown, totaling 800,000 workers affected out of 2.1 million civilian non-postal federal employees.
A January 2019 Congressional Budget Office report estimated that the 35-day partial government shutdown cost the American economy at least $11 billion, including $3 billion in permanent losses the CBO estimate excluded indirect costs that were difficult to quantify. The shutdown had an adverse effect on the budgets of state and local governments, as states covered some federal services during the shutdown.