Trump: $4 ($5.6) trillion increase in cumulative deficit, minus tariff revenue increase. Harris: $1.7 trillion. On the tariff impact, you have to ask: “do you feel lucky?”
For Trump, extending the 2017 TCJA provisions would at $4 trillions over ten year. Some of that might be made up with tariffs (at most $225 bn/yr, assuming no feedback to quantities, and aggregate GDP (pretty unlikely). For Harris, housing credits and expansion of the Child Tax Credit, Earned Income Tax Credit, and health care subsidies would increase the ten year budget deficit by $1.7 billion. Exempting tips from taxation would have impacts of $150-$250 billion/yr, with a big upside risk, in the Trump proposal, and $100-$200 billion in the Harris proposal.
- Trump TCJA extension (CRFB)
- Trump 10/60 tariffs (PIIE)
- Harris Lower Cost for American Families agenda (CRFB)
- Trump tips exemption (CRFB)
- Harris tips exemption and minimum wage proposal (CRFB)
[corrections to some figures, to read trillions – MDC]
Trillion?
Macroduck: Yes! Corrected now.
Everett Dirksen updated. A trillion here, a trillion there, pretty soon we’ll be talking about real money. Or was that Dr. Evil?
Trump would spend and spend on whatever makes him happy paid for by massive tax cuts for the rich – only partially offset by taxing the rest of us.
Harris would spend on things that make our economy more productive and reduce taxes on the rest of us by letting those 2017 tax cuts for the rich expire and raising the corporate tax rate to 28% with stronger enforcement of transfer pricing.
We could ask Bruce Hall to do the arithmetic but the poor boy is still struggling with 2 plus 2.
I didn’t go in details, but it feels like there should be trillions instead of billions in the text. If both candidates provided us with proposals in which deficit would go up by a few billions the discussion of deficit growth would be essentially nonexistent
Vasyl: Yes. First few 10 year span items are in trillions. Fixed now.
I guess Trump figured out that he would lose a lot of rich donors for some of the most crazy stuff he jus peddling:
https://www.cnn.com/2024/08/20/business/trump-federal-reserve-independence/index.html
The problem being that he will not actually back down in a crunch. So if those donors come back and manage to get him elected they will find him intervening in interest rates and crash the economy.