Tag: Trump doesn’t understand economics

Trump threatens to veto GOP relief bill unless it includes payroll tax cut that favors the rich

AlterNet logoPresident Donald Trump threatened to veto the Republican coronavirus relief proposal unless it includes a payroll tax cut, which would overwhelmingly benefit the rich and potentially cut funding for Social Security and Medicare.

Trump confirmed reports about his push to include a payroll tax holiday in an interview with Fox News that first aired on Sunday.

“I would consider not signing it if we don’t have a payroll tax cut,” Trump said, claiming that “a lot of Republicans like it.” Continue reading.

Trump wants a payroll tax cut in the next stimulus package. It’s a bad idea.

Washington Post logoThe White House is pressing for cuts to the Social Security and Medicare payroll tax — but it won’t help the people who need it most and would be a nightmare to administer

There are things that make great sense in theory but make no sense in the actual world in which we live. President Trump’s idea of eliminating (or modifying or who-knows-what-ing) the Social Security-Medicare payroll tax as part of an economic stimulus package is a classic example of something that makes no sense in the real world.

In theory, eliminating or reducing payroll taxes is the quickest and cleanest way to stimulate the economy for people who have jobs. Suddenly, those people are taking home more money than they were. That’s why payroll taxes have been cut before to stimulate the economy, and it seems to have worked.

But in our current environment, it makes no sense to cut or eliminate the payroll tax — paid equally by employees and employers — to provide emergency assistance to people in need and boost the economy, which needs all the stimulus it can get. Continue reading.

White House warns stimulus package ‘must’ include Trump payroll tax cut proposal

Washington Post logoSenate Republicans have resisted the move, but the president continues to demand it

The White House is insisting that Congress include a payroll tax cut as part of the next coronavirus stimulus package, potentially complicating talks with lawmakers by pushing a measure that President Trump has tried but failed to advance for almost a year.

“As he has done since the beginning of this pandemic, President Trump wants to provide relief to hardworking Americans who have been impacted by this virus and one way of doing that is with a payroll tax holiday,” White House spokesman Judd Deere said in a statement. “He’s called on Congress to pass this before and he believes it must be part of any phase four package.”

Trump’s renewed push for a payroll tax holiday comes as Senate Majority Leader Mitch McConnell (R-Ky.) prepares to unveil legislation next week that he hopes will launch negotiations on the next major coronavirus bill. Continue reading.

Trump’s Trade War Will Cost Average Family $1,277 This Year, Budget Office Reveals

The extra costs will effectively wipe out savings from the president’s tax cuts.

President Donald Trump’s ongoing trade wars are expected to cost the average American family $1,277 this year, according to a study by the nonpartisan Congressional Budget Office.

The figure is based on the negative impact of tariffs on economic growth, as well as higher prices to consumers as American manufacturers and retailers are forced to pay tariffs on imports.

Trump has boasted that trade wars are “easy to win,” and has repeatedly falsely insisted that China is paying tariffs directly into the U.S. Treasury. In fact, American companies importing goods or supplies pay tariffs enacted by Trump, and typically pass on those costs to consumers. In addition, U.S. industries are hurt by retaliatory tariffs enacted by other nations when American companies try to sell their products abroad.

Trump blames Fed for manufacturing slowdown

The Hill logoPresident Trump on Tuesday blamed the Federal Reserve for a recent slowdown in manufacturing, a key sector he promised to revive as a candidate.

“The Federal Reserve loves watching our manufacturers struggle with their exports to the benefit of other parts of the world,” he tweeted. “Our Fed has been calling it wrong for too long!”

The manufacturing sector’s output has shrunk for two consecutive quarters, meeting the widely accepted definition of a recession. It has been among the hardest-hit sectors from Trump’s escalating trade war with China.

View the complete August 27 article by Niv Elis on The Hill website here.