Those of us living in reality can now say that the corporate tax cuts were a failure that hurt revenue and did nothing for the economy. So the question is why? I think it likely has to do with the fact so many of our corporations are near monopolies. Curious what others think.
Trump handed big business a massive tax cut, and all he got in return was embarrassment
Two years after his administration passed a massive tax cut for corporations meant to spur economic growth, the verdict is in, and the results are embarrassing. The tax cuts did not
"unleash animal spirits" (as the business media is so fond of saying). And it did not
usher in a period of 3% GDP growth(as Trump's administration was so fond of echoing).
The plan did not — by any stretch of the imagination — "pay
for itself with growth and reduced deductions," as Treasury Secretary Steve Mnuchin said it would back in 2017. In fact, the US budget deficit
has grown by 50% since Trump took office.
It didn't fail. There were a lot of capital expenditures with the windfall. It was just implemented inefficiently.
The problem is that it wasn't targeted. A lot of the money went to stock buybacks and other internal spends. Since we don't like to do anything more than simplistic band aids to please the bases, we didn't provide guardrails for the cuts. So the corporations just did what they're chartered to do as fiduciaries: Act in the best (usually short-term) interests of their stockholders.
The Trumpsters don't drill down more than about half an inch on anything, so they don't understand that part. And the left wingers will only look at the the inefficiencies and ignore the extra capital expenditures.
Just another good example of why we so desperately need to find a way to stop the nutters from controlling the conversation.
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I'm looking at it failing based on what trump promised. He said they would pay for themselves and increase gdp growth to 4-6%. I'm not following how you are saying it wasn't a failure? The opposite happened of what was claimed. I'm pretty confident without them the economy would be pretty much the same, but deficits would be much smaller. It seems to have been just a huge handout to the rich.
Oh, the Trumpsters don't give two shits about that. He's gone hyper-Keynesian, something they would have attacked with both barrels just four years ago, and they don't care.
All they know is what they are provided in their little universe. What I said above will not enter that universe.
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I was expecting there to be noticeable growth myself so I’m really curious how such a big cut delivered just a temporary bump. I think it has to do with so many Corps having near monopolies...
Well, I've been studying this crap pretty carefully, and my guess (at this moment) is that the middle and lower middle classes STILL don't have enough disposable income, even with the wage growth. On top of that, both individual and corporate debt are WAY up there, meaning we've burned through our cash.
This, after pouring every stimulative idea we have at the economy, fiscal responsibility be damned in favor of partisan politics.
2.1% growth, and no inflation,
after Trump's All You Can Eat Fiscal Donut Truck? Something isn't right. I dunno.
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