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as economy slows, recession risk rises and markets wobble, worth reviewing what 2017 tax cut has done so far
Trump WH/GOP Congress said it would rev up growth, investment and wages
in this thread, what Congressional Research Service has found /1
everycrsreport.com/reports/R45736…
Trump WH/GOP Congress said it would rev up growth, investment and wages
in this thread, what Congressional Research Service has found /1
everycrsreport.com/reports/R45736…
on growth: "increase in (2018) growth in line w/trend" since 2013
"in addition to the effect from tax cuts, there was some stimulus due to the increase in spending
"on the whole, the growth effects tend to show a relatively small (if any) first-year effect on the economy"
/2
"in addition to the effect from tax cuts, there was some stimulus due to the increase in spending
"on the whole, the growth effects tend to show a relatively small (if any) first-year effect on the economy"
/2
on the "dynamic" growth needed to keep falling revenues from ballooning government deficits: "the combination of projections and observed effects for 2018 suggests a feedback effect of 0.3% of GDP or less - 5% or less of the growth needed to fully offset the revenue loss"
/3
/3
on growth in business investment: "real growth in equipment, structures and intellectual property is inconsistent with the incentive effects of the tax change
"effects of investment in structures would be expected to be largest. to date this pattern gas not been observed"
/4
"effects of investment in structures would be expected to be largest. to date this pattern gas not been observed"
/4
on tax rates for corporations: "the effective rate dropped by 48%", from 23.4% in 2017 to 12.1% in 2018
on tax rates for individuals: "reduction in effect rate of 4%", from 9.6% in 2017 to 9.2% in 2018
/5
on tax rates for individuals: "reduction in effect rate of 4%", from 9.6% in 2017 to 9.2% in 2018
/5
on wages: "there is no indication of a surge in wages in 2018, either compared to history or relative to GDP growth. real wages increased by 1.2%"
/6
/6
on investment flows into the US: "the evidence does not suggest a surge in investment from abroad in 2018"
on worker bonuses: "organization that tracks bonuses reported total of $4.4-B. With US employment of 157-M, this amount is $28 per worker, 2%-3% of corporate tax cut.
"much of these funds used for record-breaking $1-T stock buybacks; similar repurchases w/2004 tax holiday"
/8
"much of these funds used for record-breaking $1-T stock buybacks; similar repurchases w/2004 tax holiday"
/8
on keeping US firms from moving abroad: "though 2017 Act contributed to making inversions less attractive, inversions had already slowed substantially following regulatory changes implemented in 2014-16. Foreign acquisitions of US companies fell 15% in 2016, 32% in 2017
/9-end
/9-end
