The Tax Cuts and Jobs Act will do some major damage to the U.S economy, CBO reports. Time for second thoughts?
H.R 1, known as the Tax Cuts and Jobs Act was signed into law 4 days before Christmas of 2017. The majority who voted in favor were psyched due to the economic growth this could produce. The others, such as Nancy Pelosi, sought to have believed these were only going to be ‘crumbs’ and used the hashtag #GOPTaxscam. However, it’s not a scam.
99.7% of American businesses are privately held, also known as ‘small businesses’. The bill is projected to create over 1.1M jobs and a 0.7% economic growth to the American economy.
Yet, what this bill also brings is a massive deficit and more debt. The non-partisan Congressional Budget Office released a costly estimate on the bill’s effects. Reuters reported, “The deficit – the amount that Washington’s spending exceeds its revenues – will expand to $804 billion in fiscal 2018, which ends on Sept. 30, up from $665 billion in fiscal 2017”, according to the CBO.
The national debt is set to hit about 100% of GDP, or gross domestic product, by the year 2028. GDP growths are set to decrease gradually across the next three years: 3.3% in 2018, 2.4% for 2019, and 1.8% in 2020.
CNBC said, “By 2028, the national debt would total 96 percent of GDP.”
With midterms creeping up, another question raises eyebrows to American voters: will there be more spending or will new candidates do the same?
Although the tax cuts will bring short term economic growth and stability, more debt and more federal deficit is exactly what President Trump said he wasn’t going to do.
Jorge Velasco is the founder and CEO of theDailyLead.