Thread by @Noahpinion

Greetings, my fellow Americans! In today's @bopinion post, I evaluate the performance of Trump's tax reform so far.

Short version: Big gains for shareholders, a little bit of business investment, no gains for workers yet.

bloomberg.com/view/articles/…

Now remember, tax policy changes take a while to have an effect. It's only been two quarters so far.

BUT, it's important to try to get an early picture of the tax cut's effects, since by next year they'll be confounded by the Trade War and other stuff.

First, let's look at wages.

Ultimately, that's what we really care about.

Since the tax cut was passed, wages have gone nowhere. Here are government data and private data from PayScale.

Now, wages should take a while to increase.

First, companies have to INVEST in response to the tax cut, then that demand has to push up wages.

So are companies investing? Yes they are, a little bit.

But investment wasn't enough to drive a growth spurt in the first quarter.

Maybe in the second we'll see some action?

But even if the second quarter sees a bump in growth, it now appears highly unlikely that the tax cut will come close to paying for itself.

Meanwhile, share buybacks have increased rapidly. So at least the tax cut did something, right? :D

Anyway, it's too early to tell the full effects of the tax reform. But soon, as the Trade War and other random economic stuff intervene, it will be too late.

We'll never fully know the impact of the tax cut.

But early results are a bit underwhelming.

(end)