Economic policy of Donald Trump

Health care coverage and cost results

On January 15, 2017, president-elect Trump said he was nearing completion of a new health insurance program to replace Obamacare, stating, "We're going to have insurance for everybody."^[44] One year later, Gallup reported that the percentage of uninsured adults rose from a record low of 10.9% in Q4 2016 to 12.2% in Q4 2017; the 1.3 percentage point increase represented 3.2 million more Americans without insurance.^[45] Combining the Kaiser Family Foundation estimate of 28 million uninsured in 2016 with the 3.2 million increase in the Gallup poll would indicate there were about 31 million without insurance in Q4 2017.^[46] The Washington Post cited research indicating that 3.2 million more uninsured represents 4,000 avoidable deaths.^[47]

The New York Times reported in December 2017 that about 8.8 million persons signed up for ACA coverage via the marketplace exchanges for the 2018 policy period, roughly 96% of the 9.2 million who signed-up for the 2017 policy period. An estimated 2.4 million were new customers and 6.4 million returned. These figures represent the national Healthcare.gov exchanges in 39 states and not 11 states that operate their own exchanges and also reported strong enrollment. The enrollment numbers "essentially defied President Trump's assertion that 'Obamacare is imploding'".^[48]

About 80% of persons who buy insurance through the marketplaces qualify for subsidies to help pay premiums. The Trump Administration reported in October 2017 that the average subsidy would rise to $555 per month in 2018, up 45% from 2017. This increase was due significantly to the actions it took to hinder ACA implementation.^[48] Prior to Trump taking office, several insurance companies estimated there would be a 10% increase in premiums and related subsidies for 2017.^[39]

Gains in healthcare coverage under President Obama began to reverse under President Trump. The Census Bureau reported that the number of uninsured persons rose from 27.3 million in 2016 to 28.0 million in 2017. The uninsured rate rose from 8.6% in 2016 to 8.7% in 2017. This was the first increase in the number and rate of uninsured since 2010.^[21] Further, the Commonwealth Fund estimated in May 2018 that the number of uninsured increased by 4 million from early 2016 to early 2018. The rate of those uninsured increased from 12.7% in 2016 to 15.5%. This was due to two factors: 1) Not addressing specific weaknesses in the ACA; and 2) Actions by the Trump administration that exacerbated those weaknesses. The impact was greater among lower-income adults, who had a higher uninsured rate than higher-income adults. Regionally, the South and West had higher uninsured rates than the North and East. Further, those 18 states that have not expanded Medicaid had a higher uninsured rate than those that did.^[49]

Legislation

President Trump advocated repealing and replacing the Affordable Care Act (ACA or "Obamacare"). The Republican-controlled House passed the American Health Care Act (AHCA) in May 2017, handing it to the Senate, which decided to write its own version of the bill rather than voting on the AHCA.^[50] The Senate bill, called the "Better Care Reconciliation Act of 2017" (BCRA), failed on a vote of 45–55 in the Senate during July 2017. Other variations also failed to gather the required support, facing unanimous Democratic Party opposition and some Republican opposition.^[51] The Congressional Budget Office estimated that the bills would increase the number of uninsured by over 20 million persons while reducing the budget deficit marginally.^[52]

Actions to hinder implementation of ACA

President Trump continued Republican attacks on the ACA while in office, according to the New York Times,^[38] including steps such as:

• Weakening the individual mandate through his first executive order, which resulted in limiting enforcement of mandate penalties by the IRS. For example, tax returns without indications of health insurance ("silent returns") will still be processed, overriding instructions from the Obama administration to the IRS to reject them.^[53]
• Reducing funding for advertising for the 2017 and 2018 exchange enrollment periods by up to 90%, with other reductions to support resources used to answer questions and help people sign-up for coverage. This action could reduce ACA enrollment.^[54]
• Cutting the enrollment period for 2018 by half, to 45 days. The NYT editorial board referred to this as part of a concerted "sabotage" effort.^[55]
• Issuing public statements that the exchanges are unstable or in a death spiral.^[56] CBO reported in May 2017 that the exchanges would remain stable under current law (ACA), but would be less stable if the AHCA were passed.^[52]

Several insurers and actuary groups cited uncertainty created by President Trump, specifically non-enforcement of the individual mandate and not funding cost sharing reduction subsidies, as contributing 20–30 percentage points to premium increases for the 2018 plan year on the ACA exchanges. In other words, absent Trump's actions against the ACA, premium increases would have averaged 10% or less, rather than the estimated 28–40% under the uncertainty his actions created.^[39] The Center on Budget and Policy Priorities (CBPP) maintains a timeline of many "sabotage" efforts by the Trump Administration.^[57]

Ending cost-sharing reduction (CSR) payments

President Trump announced in October 2017 he would end the smaller of the two types of subsidies under the ACA, the cost-sharing reduction (CSR) subsidies. This controversial decision significantly raised premiums on the ACA exchanges (as much as 20 percentage points) along with the premium tax credit subsidies that rise with them, with the CBO estimating a $200 billion increase in the budget deficit over a decade.^[58] CBO also estimated that initially up to one million fewer would have health insurance coverage, although more might have it in the long run as the subsidies expand. CBO expected the exchanges to remain stable (e.g., no "death spiral") as the premiums would increase and prices would stabilize at the higher (non-CSR) level.^[59]

President Trump's argument that the CSR payments were a "bailout" for insurance companies and therefore should be stopped, actually results in the government paying more to insurance companies ($200B over a decade) due to increases in the premium tax credit subsidies. Journalist Sarah Kliff therefore described Trump's argument as "completely incoherent."^[58]

Repeal of the ACA individual mandate

President Trump signed the Tax Cuts and Jobs Act into law in December 2017, which included the repeal of the individual mandate of the Affordable Care Act (ACA). This removed the requirement that all persons purchase health insurance or pay a penalty. The Congressional Budget Office estimated that up to 13 million fewer persons would be covered by health insurance by 2027 relative to prior law and insurance premiums on the exchanges would increase by about 10 percentage points. This is because removing the mandate encourages younger and typically healthier persons to opt out of health insurance on the ACA exchanges, increasing premiums for the remainder. The non-group insurance market (which includes the ACA exchanges) would continue to be stable (i.e., no "death spiral"). CBO estimated this would reduce government spending for healthcare subsidies to lower income persons by up to $338 billion in total during the 2018–2027 period compared to the prior law baseline.^[60][61] Trump stated in an interview with The New York Times in December 2017: "I believe we can do health care in a bipartisan way, because we've essentially gutted and ended Obamacare."^[62]

The CBO released an analysis on May 23, 2018 indicating that repeal of the individual mandate will increase the number of uninsured by 3 million and increase individual healthcare insurance premiums by 10% through 2019. The CBO projected that another 3 million would become uninsured over the following two years due to repeal of the mandate.^[63]

On June 7, 2018 the Trump Justice Department notified a federal court that the ACA provisions that prohibit insurers from denying coverage or charging higher rates to people with pre-existing conditions were inextricably linked to the individual mandate and so must be struck down, hence the Department would no longer defend those provisions in court.^[64] Polls have consistently shown that the pre-existing conditions provisions have been the most popular aspect of ACA.^[65]

CBO baseline projections

In January 2017, the Congressional Budget Office reported its baseline budget projections for the 2017–2027 time periods, based on laws in place as of the end of the Obama administration. CBO forecasted that "debt held by the public" would increase from $14.2 trillion in 2016 to $24.9 trillion by 2027, an increase of $10.7 trillion. The sum of deficits (debt addition) for the 2018-2027 period would be $9.4 trillion. These increases are primarily driven by an aging population, which impacts the costs of Social Security and Medicare, along with interest on the debt.^[28]

As President Trump introduces his budgetary policies, the impact can be measured against the January 2017 baseline. For example, the CBO April 2018 current law baseline included a debt increase of $11.7 trillion for 2018-2027, a $2.3 trillion increase ($18,200/household) versus the January 2017 baseline of $9.4 trillion, mainly due to the Tax Cuts and Jobs Act. The CBO April 2018 current policy or alternate baseline included a debt increase of $13.7 trillion for 2018-2027, a $4.3 trillion increase ($34,000/household) versus the January 2017 baseline. The current policy baseline assumes the tax cuts are extended beyond their scheduled expiration date. The per-household figures are computed using the 2017 figure of about 126.2 million households.^[6]

CBO also estimated that if policies in place as of the end of the Obama administration continued over the following decade, real GDP would grow at approximately 2% per year, the unemployment rate would remain around 5%, inflation would remain around 2%, and interest rates would rise moderately.^[28] President Trump's economic policies can also be measured against this baseline.

CBO scoring of the 2018 budget

A budget document is a statement of goals and priorities, but requires separate legislation to achieve them. As of January 2018, the Tax Cuts and Jobs Act was the primary legislation passed that moved the budget closer to the priorities set by Trump.

Trump released his first budget, for FY2018, on May 23, 2017. It proposed unprecedented spending reductions across most of the federal government, totaling $4.5 trillion over ten years,^[70] including a 33% cut for the State Department, 31% for the EPA, 21% each for the Agriculture Department and Labor Department, and 18% for the Department of Health and Human Services, with single-digit increases for the Department of Veterans Affairs, Department of Homeland Security and the Defense Department.^[71] The Republican-controlled Congress promptly rejected the proposal.^[72] Instead, Congress pursued an alternative FY2018 budget^[73] linked to their tax reform agenda; this budget was adopted in late 2017, after the 2018 fiscal year had begun.^[74] The budget agreement included a resolution specifically providing for $1.5 trillion in new budget deficits over ten years to accommodate the Tax Cuts and Jobs Act that would be enacted weeks later.^[75] Trump released his second budget, for FY2019, on February 23, 2018; it also proposed major spending reductions, totaling $3 trillion over ten years, across most of the federal government.^[76] This budget was also largely ignored by the Republican-controlled Congress.^[70] One month later, Trump signed a $1.3 trillion bipartisan, omnibus spending bill to fund the government through the end of FY2018, hours after he had threatened to veto it. The bill increased both defense and domestic expenditures, and Trump was sharply criticized by his conservative supporters for signing it.^[77][78] Trump then vowed, "I will never sign another bill like this again."^[79]

The Congressional Budget Office reported its evaluation of President Trump's FY2018 budget on July 13, 2017, including its effects over the 2018–2027 period.

• Mandatory spending: The budget cuts mandatory spending by a net $2,033 billion (B) over the 2018–2027 period. This includes reduced spending of $1,891B for healthcare, mainly due to the proposed repeal and replacement of the Affordable Care Act (ACA/Obamacare); $238B in income security ("welfare"); and $100B in reduced subsidies for student loans. This savings would be partially offset by $200B in additional infrastructure investment.
• Discretionary spending: The budget cuts discretionary spending by a net $1,851 billion over the 2018–2027 period. This includes reduced spending of $752 billion for overseas contingency operations (defense spending in Afghanistan and other foreign countries), which is partially offset by other increases in defense spending of $448B, for a net defense cut of $304B. Other discretionary spending (cabinet departments) would be reduced by $1,548B.
• Revenues would be reduced by $1,000B, mainly by repealing the ACA, which had applied higher tax rates to the top 5% of income earners. Trump's budget proposal was not sufficiently specific to score other tax proposals; these were simply described as "deficit neutral" by the Administration.
• Deficits: CBO estimated that based on the policies in place as of the start of the Trump administration, the debt increase over the 2018–2027 period would be $10,112B. If all of President Trump's proposals were implemented, CBO estimated that the sum of the deficits (debt increases) for the 2018–2027 period would be reduced by $3,276B, resulting in $6,836B in total debt added over the period.
• CBO estimated that the debt held by the public, the major subset of the national debt, would rise from $14,168B (77.0% GDP) in 2016 to $22,337B (79.8% GDP) in 2027 under the President's budget, versus 91.2% GDP under the pre-Trump policy baseline.^[36]

Actual results FY2017

Fiscal year 2017 (FY2017) ran from October 1, 2016 to September 30, 2017; President Trump was inaugurated in January 2017, so he began office in the fourth month of the fiscal year, which was budgeted by President Obama. In FY2017, the actual budget deficit was $666 billion, $80 billion more than FY2016. FY2017 revenues were up $48 billion (1%) vs. FY2016, while spending was up $128 billion (3%). The deficit was $107 billion more than the CBO January 2017 baseline forecast of $559 billion. The deficit increased to 3.5% GDP, up from 3.2% GDP in 2016 and 2.4% GDP in 2015.^[80]

FY2018 results

Fiscal year 2018 (FY 2018) ran from October 1, 2017 through September 30, 2018. It was the first fiscal year budgeted by President Trump. The CBO reported on October 5, 2018 that the budget deficit rose from $665 billion in FY2017 to $782 billion in FY2018, an increase of $117 billion or 18%. Tax receipts increased 0.4%, while outlays increased 3.2%. The 2018 deficit was an estimated 3.9% of GDP, up from 3.5% GDP in 2017.^[81]

During January 2017, just prior to President Trump's inauguration, CBO forecast that the FY 2018 budget deficit would be $487 billion if laws in place at that time remained in place. The $782 billion actual result represents a $295 billion or 61% increase versus that forecast.^[29] This difference was mainly due to the Tax Cuts and Jobs Act, which took effect in 2018, and other spending legislation.^[81]

Ten year forecasts 2018–2028

The CBO estimated the impact of Trump's tax cuts and separate spending legislation over the 2018–2028 period in their annual "Budget & Economic Outlook", released in April 2018:

• CBO forecasts a stronger economy over the 2018–2019 periods than do many outside economists, blunting some of the deficit impact of the tax cuts and spending increases.
• Real (inflation-adjusted) GDP, a key measure of economic growth, is expected to increase 3.3% in 2018 and 2.4% in 2019, versus 2.6% in 2017. It is projected to average 1.7% from 2020–2026 and 1.8% in 2027–2028. Over 2017–2027, real GDP is expected to grow 2.0% on average under the April 2018 baseline, versus 1.9% under the June 2017 baseline.
• The non-farm employment level would be about 1.1 million higher on average over the 2018–2028 period, about 0.7% level higher than the June 2017 baseline.
• The budget deficit in fiscal 2018 (which runs from October 1, 2017 to September 30, 2018, the first year budgeted by President Trump) is forecast to be $804 billion, an increase of $139 billion (21%) from the $665 billion in 2017 and up $242 billion (39%) over the previous baseline forecast (June 2017) of $580 billion for 2018. The June 2017 forecast was essentially the budget trajectory inherited from President Obama; it was prepared prior to the Tax Act and other spending increases under President Trump.
• For the 2018–2027 period, CBO projects the sum of the annual deficits (i.e., debt increase) to be $11.7 trillion, an increase of $1.6 trillion (16%) over the previous baseline (June 2017) forecast of $10.1 trillion.
• The $1.6 trillion debt increase includes three main elements: 1) $1.7 trillion less in revenues due to the tax cuts; 2) $1.0 trillion more in spending; and 3) Partially offsetting incremental revenue of $1.1 trillion due to higher economic growth than previously forecast. The $1.6 trillion figure is approximately $12,700 per family or $4,900 per person total.
• Debt held by the public is expected to rise from 78% of GDP ($16 trillion) at the end of 2018 to 96% GDP ($29 trillion) by 2028. That would be the highest level since the end of World War Two.
• CBO estimated under an alternative scenario (in which policies in place as of April 2018 are maintained beyond scheduled initiation or expiration) that deficits would be considerably higher, rising by $13.7 trillion over the 2018–2027 period, an increase of $3.6 trillion (36%) over the June 2017 baseline forecast. Maintaining current policies for example would include extending the individual Trump tax cuts past their scheduled expiration in 2025, among other changes. The $3.6 trillion figure is approximately $28,500 per household or $11,000 per person total.^[29]

The Committee for a Responsible Federal Budget (CRFB) estimated that the legislation passed by the Donald Trump Administration would add significantly to the national debt over the 2018–2028 window, relative to a baseline without that legislation:

• Debt held by the public in 2028 would increase from $27.0 trillion to $29.4 trillion, an increase of $2.4 trillion.
• Debt held by the public as a percent of GDP in 2028 would increase from 93% GDP to 101% GDP.
• Deficits would begin to exceed $1 trillion each year starting with 2019, reaching $1.7 trillion by 2028.
• Deficits would rise from 3.5% GDP in 2017 to 5.3% GDP in 2019 and 5.7% GDP by 2028.
• Under an alternate scenario where the Trump tax cuts for individuals are extended (among other assumptions), the debt would reach $33.0 trillion or 113% GDP in 2028.^[82]

Federal corporate income tax receipts

Federal corporate tax receipts fell from an annualized level of $409 billion in Q1 2017 to $269 billion in Q1 2018, a direct result of the Trump tax cuts.^[83][84]

2017 proposal

CBO forecasts that the 2017 Tax Act will increase the sum of budget deficits (debt) by $2.289 trillion over the 2018-2027 decade, or $1.891 trillion after macro-economic feedback.^[5]

CBO and JCT estimate of the distribution of impact by income group (average dollars per taxpayer) under the Tax Cuts and Jobs Act. On average, taxpayers in the income groups highlighted in yellow will incur a net cost (shown as a positive figure as this reduces the budget deficit), mainly due to reduced healthcare subsidies. Higher income taxpayers receive a benefit via tax cuts (shown as a negative number as this increases the budget deficit). The percent of taxpayers in each income group is also shown for the 2023 period.^[7][85]

Distribution of benefits during 2018 by income percentile under the Tax Cuts and Jobs Act (Conf. Cmte. version) based on data from the Tax Policy Center. The top 10% of taxpayers (incomes over $216,800) receive 52% of the benefit, while the bottom 60% (incomes under $86,100) receive 17% of the benefit. This excludes the impact of reduced ACA subsidies.^[86]

In late September 2017, the Trump administration proposed a tax overhaul. The proposal would reduce the corporate tax rate to 20% (from 35%) and eliminate the estate tax. On individual tax returns it would change the number of tax brackets from seven to three, with tax rates of 12%, 25%, and 35%; apply a 25% tax rate to business income reported on a personal tax return; eliminate the alternative minimum tax; eliminate personal exemptions; double the standard deduction; and eliminate many itemized deductions (specifically retaining the deductions for mortgage interest and charitable contributions).^[87][88] It is unclear from the details offered whether a middle-class couple with children would see tax increase or tax decrease.^[89]

In October 2017 the Republican-controlled Senate and House passed a resolution to provide for $1.5 trillion in deficits over ten years to enable enactment of the Trump tax cut. As Reuters reported:^[90]

Republicans are traditionally opposed to letting the deficit grow. But in a stark reversal of that stance, the party's budget resolution, previously passed by the Senate, called for adding up to $1.5 trillion to federal deficits over the next decade to pay for the tax cuts.

In December 2017, the Trump Treasury Department released a one-page summary of the nearly 500-page Senate tax bill that suggested the tax cut would more than pay for itself, based on an assumption of higher economic growth than any independent analysis had forecast.^[91] Every detailed, independent analysis found that the enacted tax cut would increase budget deficits.^[92]

The House passed its version of the Trump tax plan on November 16, 2017, and the Senate passed its version on December 2, 2017. Important differences between the bills were reconciled by a conference committee on December 15, 2017.^[93] The President signed the bill into law on December 22, 2017.^[94]

Major elements of the new tax law include reducing tax rates for businesses and individuals; a personal tax simplification by increasing the standard deduction and family tax credits, but eliminating personal exemptions and making it less beneficial to itemize deductions; limiting deductions for state and local income taxes (SALT) and property taxes; further limiting the mortgage interest deduction; reducing the alternative minimum tax for individuals and eliminating it for corporations; reducing the number of estates impacted by the estate tax; and repealing the individual mandate of the Affordable Care Act (ACA).^[95]

Just prior to signing the bill, Trump asserted the new tax law might generate GDP growth as high as 6%.^[96]

On numerous occasions, Trump has falsely asserted the tax cut was the largest in history.^{[97][98][99][100][101]}

Impact on the economy, deficit and debt

The non-partisan Joint Committee on Taxation of the U.S. Congress published its macroeconomic analysis of the Senate version of the Act, on November 30, 2017:

• Gross domestic product would be 0.7% higher on average each year during the 2018–2027 period relative to the CBO baseline forecast, a cumulative total of $1,895 billion, due to an increase in labor supply and business investment. This is the level of GDP, not annual growth rate, so the economic impact is relatively minor.
• Employment would be about 0.6% higher each year during the 2018–2027 period than otherwise. The lower marginal tax rate on labor would provide "strong incentives for an increase in labor supply."
• Personal consumption, the largest component of GDP, would increase by 0.6%.^[4]

The CBO estimated in April 2018 that implementing the Act would add an estimated $2.289 trillion to the national debt over ten years,^[5] or about $1.891 trillion ($15,000 per household) after taking into account macroeconomic feedback effects, in addition to the $9.8 trillion increase forecast under the current policy baseline and existing $20 trillion national debt.^[6]

Both the CBO and the JCT economic models assumed positive GDP growth in each year of their 10-year projections, thereby excluding any effect of recessions that typically cause federal tax receipts to decline, resulting in higher deficits.^[102]

As Trump celebrated the six-month anniversary of the tax cut on June 29, 2018, National Economic Council director Larry Kudlow asserted that the tax cut was generating such growth that "it's throwing off enormous amount[s] of new tax revenues" and "the deficit, which was one of the other criticisms, is coming down—and it's coming down rapidly." Both assertions were incorrect. Since the tax cut was enacted, federal tax receipts increased 1.9% on a year-on-year basis, while they increased 4.0% during the comparable period in 2017. By the same method, the federal budget deficit increased 37.8% while it increased 16.4% during the comparable period in 2017. Kevin Hassett, chairman of Trump's Council of Economic Advisers, noted days earlier that the deficit was "skyrocketing," which is consistent with the analysis of every reputable budget analyst.^[103][104] Kudlow later asserted he was referring to future deficits, although every credible budget forecast indicates increasing deficits in coming years, made worse by the Trump tax cut if not offset by major spending cuts. Barring such spending cuts, the CBO projected the tax cut would add $1.27 trillion in deficits over the next decade, even after considering any economic growth the tax cut might generate.^[105]

Distribution of benefits and costs

The distribution of impact from the final version of the Act by individual income group varies significantly based on the assumptions involved and point in time measured. In general, businesses and upper income groups will mostly benefit regardless, while lower income groups will see the initial benefits fade over time or be adversely impacted. CBO reported on December 21, 2017 that: "Overall, the combined effect of the change in net federal revenue and spending is to decrease deficits (primarily stemming from reductions in spending) allocated to lower-income tax filing units and to increase deficits (primarily stemming from reductions in taxes) allocated to higher-income tax filing units."^[7] For example:

• During 2019, incomes groups earning under $20,000 (about 23% of taxpayers) would contribute to deficit reduction (i.e., incur a cost), mainly by receiving fewer subsidies due to the repeal of the individual mandate of the Affordable Care Act. Other groups would contribute to deficit increases (i.e., receive a benefit), mainly due to tax cuts.
• During 2021, 2023, and 2025, income groups earning under $40,000 (about 43% of taxpayers) would contribute to deficit reduction, while income groups above $40,000 would contribute to deficit increases.
• During 2027, income groups earning under $75,000 (about 76% of taxpayers) would contribute to deficit reduction, while income groups above $75,000 would contribute to deficit increases.^[7]

The Tax Policy Center (TPC) reported its distributional estimates for the Act on December 18, 2017. This analysis excludes the impact from repealing the ACA individual mandate, which would apply significant costs primarily to income groups below $40,000. It also assumes the Act is deficit financed and thus excludes the impact of any spending cuts used to finance the Act, which also would fall disproportionally on lower income families as a percentage of their income.^[86]

• Compared to current law, 5% of taxpayers would pay more in 2018, 9% in 2025, and 53% in 2027.
• The top 1% of taxpayers (income over $732,800) would receive 8% of the benefit in 2018, 25% in 2025, and 83% in 2027.
• The top 5% (income over $307,900) would receive 43% of the benefit in 2018, 47% in 2025, and 99% in 2027.
• The top 20% (income over $149,400) would receive 65% of the benefit in 2018, 66% in 2025 and all of the benefit in 2027.
• The bottom 80% (income under $149,400) would receive 35% of the benefit in 2018, 34% in 2025 and none of the benefit in 2027, with some groups incurring costs.
• The third quintile (taxpayers in the 40th to 60th percentile with income between $48,600 and $86,100, a proxy for the "middle class") would receive 11% of the benefit in 2018 and 2025, but would incur a net cost in 2027.

The TPC also estimated the amount of the tax cut each group would receive, measured in 2017 dollars:

• Taxpayers in the second quintile (incomes between $25,000 and $48,600, the 20th to 40th percentile) would receive a tax cut averaging $380 in 2018 and $390 in 2025, but a tax increase averaging $40 in 2027.
• Taxpayers in the third quintile (incomes between $48,600 and $86,100, the 40th to 60th percentile) would receive a tax cut averaging $930 in 2018, $910 in 2025, but a tax increase of $20 in 2027.
• Taxpayers in the fourth quintile (incomes between $86,100 and $149,400, the 60th to 80th percentile) would receive a tax cut averaging $1,810 in 2018, $1,680 in 2025, and $30 in 2027.
• Taxpayers in the top 1% (income over $732,800) would receive a tax cut of $51,140 in 2018, $61,090 in 2025, and $20,660 in 2027.^[86]

If the tax cuts are paid for

Tax Policy Center analysis of the impact of the Senate version of the Tax Cuts and Jobs Act, assuming it is paid for by spending cuts that are borne evenly by all taxpayers. For example, those in quintile 3 earning $49,600 to $87,400, would incur a net cost of $370 on average, with tax cuts more than offset by spending cuts that adversely impact them.^[106]

The scoring by the organizations above assumes the tax cuts are deficit-financed, meaning that over ten years the deficit rises by $1.4 trillion relative to the current law baseline; or $1.0 trillion after economic feedback effects. However, if one assumes the tax cuts are paid for by spending cuts, the distribution is much more unfavorable to lower- and middle-income persons, as most government spending is directed to them; the higher income taxpayers tend to get tax breaks, not direct payments. According to the Tax Policy Center, if the Senate bill were financed by a $1,210 per household cut in government spending per year (a more likely scenario than focusing cuts proportionally by income or income taxes paid), then during 2019:

• The bottom 72% would be worse off than current law, meaning benefits from tax cuts would be more than offset by reduced spending on their behalf.
• The bottom 60% of taxpayers would have lower after-tax income, paying a higher average federal tax rate.
• The benefits to the 60th to 80th percentiles would be minimal, a $350 net benefit on average or 0.3% lower effective tax rate.
• Significant tax benefits would only accrue to the top 20% of taxpayers.^[106]

Republican politicians such as Paul Ryan have advocated for spending cuts to help finance the tax cuts, while the President Trump's 2018 budget includes $2.1 trillion in spending cuts over ten years to Medicaid, Affordable Care Act subsidies, food stamps, Social Security disability insurance, Supplemental security income, and cash welfare (TANF).^[106]

Criticism

A FiveThirtyEight average of November 2017 surveys showed that 32% of voters approved of the legislation while 46% opposed it.^[107] This made the 2017 tax plan less popular than any tax proposal since 1981, including the tax increases of 1990 and 1993.^[107] Trump has claimed the tax cuts on the wealthy and corporations would be "paid for by growth", although 37 economists polled by the University of Chicago unanimously rejected the claim.^[108] The Washington Post's fact-checker has found that Trump's claims that his economic proposal and tax plan would not benefit wealthy persons like himself are provably false.^[109] The elimination of the estate tax (which only applies to inherited wealth greater than $11 million for a married couple) benefits only the heirs of the very rich (such as Trump's children), and there is a reduced tax rate for people who report business income on their individual returns (as Trump does).^{[110][89][111]} If Trump's tax plan had been in place in 2005 (the one recent year in which his tax returns were leaked), he would have saved $31 million in taxes from the alternative minimum tax cut alone.^[89] If the most recent estimate of the value of Trump's assets is correct, the repeal of the estate tax could save his family about $1.1 billion.^[112]

Treasury Secretary Steven Mnuchin argued that the corporate income tax cut will benefit workers the most; however, the nonpartisan Joint Committee on Taxation and Congressional Budget Office estimate that owners of capital benefit vastly more than workers.^[113]

Economist Paul Krugman summarized what he called ten lies modern Republicans and conservatives tell about their tax plans, many of which have been deployed in this case: "But the selling of tax cuts under Trump has taken things to a whole new level, both in terms of the brazenness of the lies and their sheer number." These range from "America is the most highly taxed country in the world" (the OECD reported the U.S. is in fact one of the lowest-taxed in the OECD) to "Cutting [corporate] profits taxes really benefits workers" (corporate tax cuts mainly benefit wealthy stockholders) to "Tax cuts won't increase the deficit" (they significantly increase the deficit). Krugman referred to a Tax Policy Center estimate that by 2027, the majority of the tax cut would go to the top 1%; but only 12% to the middle class.^[114]

Economist and former Treasury Secretary Larry Summers referred to the analysis provided by the Trump administration of its tax proposal as "... some combination of dishonest, incompetent, and absurd." Summers continued that "... there is no peer-reviewed support for [the Administration's] central claim that cutting the corporate tax rate from 35 percent to 20 percent would raise wages by $4,000 per worker. The claim is absurd on its face."^[115][116]

On the day Trump signed the tax bill, polls showed that 30% of Americans approved of the new law. While its popularity has increased somewhat since, through August 2018 a plurality of Americans still dislike the law.^[117]

Despite every independent economic analysis concluding that the tax cut would increase deficits, a June 2018 survey found that 22% of Republicans agreed with that conclusion, while nearly 70% of Democrats agreed.^[118]

Job creation

As a candidate in 2016, Trump promised to create 25 million new jobs over the next decade.^[122] However, job creation has been somewhat slower under President Trump relative to the end of the Obama Administration.

• During Trump's first 20 months in office (through September 2018), 3.80 million jobs were created, versus 4.15 million in the last 20 months of the Obama administration.^[119] This is an average of 190,000 jobs per month created under Trump versus 208,000 under Obama during those periods.^[123]
• Job creation of 2.19 million (182,000 per month on average) during 2017 was below 2016 levels of 2.34 million (195,000 per month).^[119]
• Discussing the economy on July 27, 2018, Trump stated, "We have added 3.7 million new jobs since the election, a number that is unthinkable if you go back to the campaign. Nobody would have said it." While this figure was accurate for the 19 months following the election, during the 19 months prior to the election, 3.9 million jobs were created.^[124]

The Bureau of Labor Statistics (BLS) reported the number of jobs added or lost by industry group in 2017, some of which included: Professional and business services added 527,000 jobs (+2.6%), Education and Health Services added 438,000 (+1.9%), Construction added 210,000 (+3.1%), Manufacturing added 196,000 (+1.6%) and Mining and Logging added 59,000 (+8.8%).^[125] The additions in Mining and Logging were primarily in "support activities for mining" while coal mining jobs, a focus during the Trump campaign, were essentially unchanged.^[126]

An August 2018 analysis by the Associated Press found that during the year ended May, 58.5% of job creation was in counties that Trump did not carry in the 2016 election, similar to the results during the months prior to Trump's presidency. Over 35% of counties Trump carried showed job losses, compared to 19.2% of counties carried by Clinton.^[127]

Other labor market variables

While job creation (non-farm payrolls) in 2017 was below 2013–2016 levels, other labor market variables continued to improve as the economy approached full employment:^[119]

• The unemployment rate fell from 4.8% in January 2017 to 4.1% in December 2017, continuing the trend that began in 2009.^[128]
• The labor force participation rate among prime-aged workers (aged 25–54) rose from 81.4% in December 2016 to 81.9% in December 2017,^[129] marking the fourth consecutive year of increase.^[130]
• The number of persons working part-time for economic reasons (i.e., would prefer to work full-time) declined from 5.8 million in January 2017 to 5.0 million in January 2018,^[131] continuing a downward trend that began in 2010.^[132]

The BLS reported a US unemployment rate of 3.8 percent in May 2018, the lowest it has been since April 2000.^[133][134] During May 2018, black American and Asian American unemployment hit its lowest level since record-keeping began in 1972 and 2003, respectively.^[135]

Wages

Trump ran on a campaign to improve wages for the working-class, and as president he falsely asserted on several occasions that wages were rising for the first time in as many as 22 years.^{[136][137][138][139][140]} However, the average real (inflation-adjusted) hourly wage for private sector production and nonsupervisory workers (loosely, "working-class" workers) began steadily rising in November 2012, and that wage growth slowed under Trump compared to prior years, mainly due to increases in energy prices. Trump and Republicans have asserted that the corporate tax cut in the Tax Cuts and Jobs Act would cause employers to pass their tax savings on to workers in the form of wage increases, while critics predicted companies would spend most of the savings on stock repurchases and dividends to shareholders. Early evidence appeared to confirm the latter.^{[141][142][143]}

For example, average hourly earnings (for all employees on private nonfarm payrolls) rose from $26.26 in June 2017 to $26.98 in June 2018, an increase of $0.72 or 2.74%.^[144] However, inflation (CPI-U, for all items) rose 2.8% for the 12 months ending May 2018, indicating that workers' real (inflation-adjusted) hourly earnings were essentially unchanged over that mid-2017 to mid-2018 period.^[145] Real wage growth turned negative in June 2018, as the inflation rate was higher than nominal wage growth, continuing into July.^[120][146]

On September 5, 2018, Trump's top economist Kevin Hassett released new analysis indicating that real wage growth under Trump was higher than previously reported. However, the new analysis also showed that real wage growth under Trump was lower than in 2015 and 2016.^[147]

A September 2018 analysis by Reuters found that wage growth over the year ended March 2018 substantially lagged the national average in the 220 counties that flipped from voting for Obama in 2012 to voting for Trump in 2016.^[148]

Eighteen states increased their minimum wage effective January 1, 2018—including California, Florida, New York, New Jersey and Ohio—which the Economic Policy Institute estimated would provide $5 billion in additional wages to 4.5 million workers. The average increase over the 18 states was 4.4%.^[149]

Labor protection

Prior to the election, Trump proposed "Seven actions to protect American workers" in his first 100 days through his Contract with the American Voter. As of April 2017 (after 100 days) he had fulfilled three of seven.^[150] One other was partially fulfilled thereafter:

1. Renegotiate NAFTA: Unfulfilled as of April 2018.
2. Withdraw from Trans Pacific Partnership (TPP): Fulfilled by April 2017.
3. Label China a currency manipulator: Unfulfilled as of April 2018.
4. Direct study to identify foreign trading abuses: Fulfilled by April 2017 (study begun).
5. Lift restrictions on $50 trillion worth of energy reserves: Unfulfilled as of April 2017. However, the Tax Cuts and Jobs Act will open additional land for development. In early January 2017, the Trump Administration also reversed an Obama ban on offshore drilling in a significant portion of U.S. coastal waters.^[151]
6. Lift restrictions on infrastructure projects (Keystone pipeline): Fulfilled by April 2017.
7. Cancel payments to U.N. for climate change programs: Unfulfilled as of April 2017.^[150] While the overall U.N. budget was cut for 2018–2019, this is routine and it was unclear how much the U.S. contribution would be reduced as of December 2017, despite confusing press releases from the Trump Administration.^[152]

As part of the Contract with the American Voter, Trump also pledged to impose tariffs to discourage companies from laying off workers or relocating to other countries, through an "End the Offshoring Act". This was also unfulfilled as of December 2017.^[150]

Annual

The BEA reported that real gross domestic product, a measure of both production and income, grew by 2.3% in 2017, vs. 1.5% in 2016 and 2.9% in 2015.^[13] Real GDP per capita increased in 2017 for the eighth consecutive year, its fifth consecutive record high.^[153]

Discussing the second quarter 2018 GDP report, Trump stated, "We're on track to hit the highest annual average growth rate in over 13 years."^[154] The Federal Reserve median forecast for the full year 2018 was 2.8% with a range of 2.5% to 3.0% as of June 2018.^[155] For historical comparison, real GDP grew 2.9% in 2015 and 3.5% in 2005, the last time growth exceeded 3.0% for a full year.^[156]

CBO estimates real potential GDP, a measure of what the U.S. economy can sustainably produce at full employment. CBO forecast in April 2018 that from 2018-2027, real potential GDP growth would average 1.8%.^[157] Amounts above this threshold for short periods may be driven by economic stimulus (debt additions) such as the Tax Cuts and Jobs Act or unusual events such as activity to avoid tariffs.^[158]

Quarterly

Comparison of the contributions to real GDP growth from major GDP components in Q2 2018 vs. an average from Q1 2014 to Q1 2018. Net exports accounts for 1.5 of the 1.8 percentage point difference between Q2 2018 real GDP growth and the average quarter.^[159]

Real GDP growth was 4.1% in Q2 2018 (later revised to 4.2%^[160]) and 2.2% in Q1 2018.^[161] The 4.1% level was the highest since the 4.9% level in Q3 2014. There were four quarters with 4.1% or higher growth during the Obama administration (Q4 2009, Q4 2011, Q2 2014 and Q3 2014).^[162]

The 4.1% figure was boosted by net exports, which contributed 1.1 percentage points to the total due to higher exports to avoid retaliatory tariffs. Critics doubted the sustainability of this export boost.^[163] This addition from net exports was much higher than the average 0.5 percentage point reduction in real GDP growth from net exports for the Q1 2014 to Q1 2018 periods.^[164] Hypothetically, if the 0.5 average reduction due to net exports from recent periods were applied to Q2 2018 rather than the unusual 1.1 positive contribution, real GDP would have grown about 2.6%. The Committee for a Responsible Federal Budget estimated that of the 4.1% growth, legislation (tax cuts and additional spending) contributed 0.8% and Chinese pre-purchases of soybeans in anticipation of tariffs contributed 0.6%, meaning the "base" growth rate was 2.7%.^[165]

CBO also estimated that GDP cumulatively would be 0.3% higher by the end of 2018 due to the Tax Cuts and Jobs Act.^[6] A quarterly growth rate to generate a 0.3% higher cumulative total is about 0.07% per quarter, indicating the tax cuts contributed less than 0.1 percentage points to the real GDP growth rate in Q1 and Q2 2018.^[166]

From 2009 through 2016, GDP growth exceeded 3% in eight quarters—including 4.6% and 5.2% in consecutive quarters of 2014^[167]—yet it did not sustain 3% or more for any full calendar year.^[168] Although GDP exceeded 3% in two consecutive quarters of 2017, the average growth was 2.4% through Trump's first five quarters in office.^[169]

Commentary

National Economic Council director Larry Kudlow asserted on June 29, 2018, "they've been saying that all along, OK? We could never get to 3% growth ... It couldn't be done, they say. It's being done."^[170] Trump made a similar remark the previous day.^[171] However, analysts have actually said that 3% sustained growth was unlikely,^{[171][172][173][174]} rather than periodic quarters of growth of 3% or more. The final figure for first quarter 2018 GDP growth was released the day before Kudlow spoke—coming in at 2.0%^[175] (before later revision to 2.2%).

Trump falsely claimed on July 13, 2018 that "GDP since I've taken over has doubled and tripled."^[176] Real GDP had grown a cumulative total of 3.1% from Q4 2016 through Q1 2018.^[177]

Trans-Pacific partnership

In a November 10, 2015 Republican debate, Trump stated the bi-partisan, 12-nation Trans-Pacific Partnership (TPP) was "a deal that was designed for China to come in, as they always do, through the back door and totally take advantage of everyone." Politifact rated this assertion "Pants On Fire,"^[188] while the conservative Wall Street Journal editorial board wrote, "It wasn't obvious that [Trump] has any idea what's in [TPP]".^[189] Trump stated similar rhetoric about TPP on June 26, 2016, which the Washington Post factchecker found to be incorrect.^[190]

President Trump abandoned TPP during his first week in office through an executive order. This decision was a component of his "America First" strategy and signaled a change from long-term Republican orthodoxy, that expanding global trade was good for America and the world. The TPP was to create complex trade rules between 12 countries, to create an economic competitor to a rising China. The move was criticized as an opportunity for China to expand its influence in Asia.^[191]

On April 13, 2018 US President Donald Trump said the United States may rejoin TPP.^{[192][193][194][195]}

Transatlantic Trade and Investment Partnership

Upon taking office, Trump halted negotiations on the Transatlantic Trade and Investment Partnership (TTIP), which had been under way since 2013 during the Obama administration.^[196][197] In May 2018, Trump initiated a trade conflict with the EU by imposing tariffs on steel and aluminum,^[198] for which the EU retaliated in June with tariffs of their own,^[199] with Trump threatening to escalate the conflict with additional tariffs.^[200] In July 2018, Trump and the EU declared a truce of sorts, announcing they would enter into negotiations for an agreement similar to the TTIP.^[197] In a Rose Garden appearance with European Commission president Jean-Claude Juncker, Trump touted the negotiations as "a new phase in the relationship between the United States and the European Union."^[201]

Value of the dollar

In January 2018, Treasury Secretary Steven Mnuchin stated he welcomed a weaker dollar to encourage American exports.^[202] The following day, Trump stated "The dollar is going to get stronger and stronger and ultimately I want to see a strong dollar."^[203] After a three-month dollar rally,^[204] on July 20, 2018 Trump tweeted "... the dollars gets stronger and stronger with each passing day - taking away our big competitive edge."^[205]

The trade weighted dollar index measures the value of the dollar vs. several major foreign currencies. After trending generally upward since 2011 and reaching a near-record high in December 2016, the value of the dollar has since generally trended downward through April 2018, down 6.6% since Trump took office.^[206][207]

Trade deficit

According to the U.S. Census Bureau, the trade deficit during 2016 was $505 billion, with a $753 billion deficit in goods partially offset by a $248 billion surplus in services. The 2017 trade deficit was $566 billion, an increase of $61 billion or 11%, with a $810 billion deficit in goods partially offset by a $244 billion surplus in services.^[208][209] The trade deficit continued to widen during the first half of 2018.^[210][211]

The U.S. goods trade deficit with China rose from $347.0 billion in 2016 to $375.2 billion in 2017, an increase of $28.2 billion or 8%.^[212]

Trump's tax plan was criticized as likely increasing the trade deficit (i.e., imports greater than exports). In one sense, a trade deficit is a subtraction from GDP, so in theory a larger trade deficit offsets economic growth and reduces the number of jobs. However, increasing the budget deficit (as the tax bill does per CBO and JCT estimates) means increasing the trade deficit, other things equal, under the sectoral balance framework. One inconsistent argument made by the Administration for the tax cuts is that they would bring in a sizable amount of foreign capital (increasing the capital surplus and its mathematical offset, the trade deficit), which would be invested by corporations and drive increases in GDP. However, this inflow of capital would drive up the price of the dollar, hurting exports and thus raising the trade deficit and thus reducing GDP.^[213]

Economists at the Federal Reserve Bank of St. Louis explained that a trade deficit is not necessarily bad for an economy. On the positive side, a trade deficit can mean: 1) Foreigners are net investors in your country's economy and production capacity; and 2) The economy is doing sufficiently well such that your citizens are importing more from abroad than they are exporting because local demand cannot meet supply.^[214] On the negative side, if the inflow of foreign capital is used instead to bid up housing and financial asset prices (as was the case during the United States housing bubble that contributed to the Great Recession) then a trade deficit can be detrimental. In other words, it depends on how the inflow of foreign capital is used.^[215]

Tariffs

Opening trade to imports lowers the price from Pa to Pw and increases the quantity from Qa to Ct. This increases consumer surplus (the area under the demand curve but above price) by X+Z as consumers can purchase more goods at lower prices. However, it also reduces producer surplus (the area above the supply curve but below the price) by X, as domestic producers supply fewer goods at lower prices. Domestic producers will choose to produce at Qt, with the quantity gap between Qt and Ct filled by imports. This overall gain from free trade is area Z, although there are winners (consumers) and losers (domestic producers and their employees).^[216]

Diagram showing effects of an import tariff, which hurts domestic consumers more than domestic producers are helped. Higher prices and lower quantities reduce consumer surplus (the area above price but under the demand curve) by areas A+B+C+D, while expanding producer surplus (the area below price but above the supply curve) by A and government revenue by C (the import quantity times the tariff price.) Areas B and D are dead-weight losses, surplus lost by consumers and overall.^[216]

Effect of import tariff is to raise prices, employment and income in the protected industry, while reducing them in unprotected industries, mainly because consumers spending more for goods in protected industries have less to spend in unprotected industries.^[217]

Foreign investment in United States

Shortly after being elected, Trump cited a handful of anecdotes to assert that foreign investment had begun pouring into America because of his election.^[295][296] However, aggregate statistical data showed that foreign direct investment—the total flow of investment capital into the United States from the rest of the world—declined sharply during Trump's first six quarters in office, down 45% compared to the six quarters immediately preceding his presidency.^[297]

Concerned that China was acquiring advanced American technology, the Trump administration prepared to announce plans by June 30, 2018 to restrict Chinese investment in American technology companies and set technology export controls for China.^[298] Responding to reports by Bloomberg News and The Wall Street Journal,^[299][300] on June 25, 2018 Treasury Secretary Steven Mnuchin, claiming to speak on behalf of the president, denied the investment restrictions specifically targeted China, but rather applied to all countries.^[301] Later that day, Trump trade advisor Peter Navarro appeared on CNBC, first saying there would be no investment restrictions on any countries, then suggested there would be restrictions against China.^[302] Later, White House press secretary Sarah Sanders stated, "As the secretary said, a statement would go out that targets all countries that are trying to steal our technology, and we expect that to be out soon."^[302] These contradictions caused wild gyrations in stock markets, with the Dow closing down 328 points.^[303] The next day, Trump asserted that the Bloomberg and Wall Street Journal reports had been based on information from "a leaker that didn't know his business very well ... but probably, they just made up the story and there was no leak,"^[304] despite the fact that the stories confirmed what the White House had announced on May 29, 2018:

To protect our national security, the United States will implement specific investment restrictions and enhanced export controls for Chinese persons and entities related to the acquisition of industrially significant technology. The proposed investment restrictions and enhanced export controls will be announced by June 30, 2018, and they will be implemented shortly thereafter.^[298]

The Trump administration announced on June 27, 2018 that it had decided not to proceed with either the investment restrictions or the export controls outlined in the May 29 announcement—either on China or on all countries—instead favoring a bill moving through Congress to expand the Committee on Foreign Investment to vet foreign investments more closely.^[305][306]

While discussing the effects of the Trump tax cut on June 29, 2018, National Economic Council director Larry Kudlow asserted that "capital investment, you know, for new jobs and better careers, [is] flowing in from all corners of the world."^[103] However, foreign direct investment—the total flow of investment capital into the United States from the rest of the world—declined 35% on a year-on-year basis during the first quarter after the tax cut, the most recent data available. That was consistent with the 37% decline during Trump's first five quarters in office, compared to the five quarters immediately preceding his presidency.^[307]

Criticism

Analysis published on March 8, 2018 by the Council on Foreign Relations found that Trump's proposed steel tariffs could result in the loss of up to 40,000 jobs in the auto manufacturing industry.^[308]

On March 12, 2018, over 40 economists polled by the University of Chicago's IGM Forum unanimously either disagreed or strongly disagreed with the statement that: "Imposing new US tariffs on steel and aluminum will improve Americans' welfare."^[309]

Paul Krugman wrote on March 15, 2018: "What we need is a renewed commitment to universal health care, much more investment in infrastructure, policies to help families and a return to policies that empower unions, especially in the service sector. Defining trade as the problem is just a way to duck real solutions."^[310]

CNN reported on May 31, 2018 that the CEO of the United States Chamber of Commerce, a pro-business organization that generally supports Republican politicians, wrote a memo to his board which cited outside studies showing Trump's trade policies could put 2.6 million American jobs at risk.^[311]

Environmental

President Trump began a "high-profile" regulatory roll-back during 2017. The Administration adopted a more lenient approach to pollution relative to both the Bush and Obama Administrations, with less stringent enforcement by the Environmental Protection Agency.^[320]

Climate change

Trump announced the U.S. would leave the Paris Agreement on June 1, 2017. Under the Agreement, each country determines, plans and regularly reports its own contribution and targets for mitigating global warming. There is no mechanism to force a country to set a specific target by a specific date, but each target should go beyond previously set targets. As of November 2017, 195 UNFCCC members have signed the agreement, and 170 have become party to it.

The New York Times Editorial Board wrote on June 1, 2017: "Mr. Trump's policies – the latest of which was his decision to withdraw from the 2015 Paris agreement on climate change – have dismayed America's allies, defied the wishes of much of the American business community he pretends to help, threatened America's competitiveness as well as job growth in crucial industries and squandered what was left of America's claim to leadership on an issue of global importance." The Editorial Board referred to Trump's argument that an agreement to fight climate change would hurt the U.S. economy as "bogus."^[321]

Banking and consumer protection

President Trump began efforts to loosen regulations imposed on financial institutions under the Dodd-Frank Act, which was implemented following the 2007–2008 subprime mortgage crisis. The president also installed budget director Mick Mulvaney to lead the Consumer Financial Protection Bureau established by Dodd-Frank. Mr. Mulvaney had been a "staunch opponent" of the Agency's past history of broad regulations. President Trump tweeted on November 25, 2017 that "Financial institutions have been devastated and unable to properly serve the public" even though commercial banks generated a record level of profit of $157 billion in 2016, lending activity was robust, and bank stocks were in record territory.^[322] The Trump administration and others have asserted that excessive financial regulation since 2008 has caused banks, particularly smaller banks, to decline in numbers.^[323][324] However, the FDIC has noted that "Consolidation in the U.S. banking industry is a multidecade trend that reduced the number of federally insured banks from 17,901 in 1984 to 7,357 in 2011"^[325] and this trend has continued through 2017.^[326]

The Republican-controlled House passed the Financial CHOICE Act, an expansive rollback of the Dodd-Frank Act, on June 8, 2017. A less aggressive bill was approved by the Republican-controlled Senate on March 14, 2018.^[327] The House approved the Senate measure on May 22, 2018.^[328]

Net neutrality

The Federal Communications Commission (FCC) voted to repeal net neutrality regulations (the Open Internet Order) on December 14, 2017. This is expected to reduce the regulation of broadband (telecom) companies (such as AT&T and Comcast) that connect consumers' homes to the internet, essentially no longer regulating them as utilities. These providers tend to have little competition in a geographic area. Advocates and critics argued whether the move would help or hurt consumers and how it would shift market power between broadband providers and content providers (e.g., Netflix). This reversed a 2015 decision by the FCC.^[329]

Stock market

The stock market, as measured by the S&P 500, increased 20% in 2017 through December 27, 2017. Global stock markets increased 21%. During President Obama's first year in office, the stock market increased 37%.^[32] Results in recent years included: 2013 +30%; 2014 +11%; 2015 -1%; and 2016 +10%.^[332] The U.S. stock market has grown consistently since its low point in March 2009, without a 20% "correction" or bear market through August 2018, arguably the longest "bull market" in U.S. history. It climbed 320% from its trough on March 9, 2009 through August 2018.^[333]

However, about half of Americans have not participated in this bull market. In March 2017, NPR summarized the distribution of U.S. stock market ownership (direct and indirect through mutual funds) in the U.S., which is highly concentrated among the wealthiest families:

• 52% of U.S. adults owned stock in 2016. Ownership peaked at 65% in 2007 and fell significantly due to the Great Recession.
• As of 2013, the top 1% of households owned 38% of stock market wealth.
• As of 2013, the top 10% own 81% of stock market wealth, the next 10% (80th to 90th percentile) own 11% and the bottom 80% own 8%.^[334]

NPR reported that when politicians reference the stock market as a measure of economic success, that success is not relevant to nearly half of Americans. Further, more than one-third of Americans who work full-time have no access to pensions or retirement accounts such as 401(k)s that derive their value from financial assets like stocks and bonds.^[334] The NYT reported that the percentage of workers covered by generous defined-benefit pension plans has declined from 62% in 1983 to 17% by 2016.^[335] While some economists consider an increase in the stock market to have a "wealth effect" that increases economic growth, economists like Former Dallas Federal Reserve Bank President Richard Fisher believe those effects are limited.^[334]

Household net worth and income

Household net worth is the sum of financial, real estate, and business assets (non-corporate), less liabilities. In nominal terms (not adjusted for inflation) it declined in 2008 due to the Great Recession but resumed steadily rising in 2009 and reached its sixth consecutive annual record high in 2017.^[336] This was primarily driven by stock market increases, although housing price increases also contributed.^[337] The $100 trillion level was reached in Q1 2018,^[338] which is approximately $800,000 per household on average.^[339] However, the median (50th percentile) family had $100,000 net worth in 2016, an indicator of the dramatic wealth inequality in the U.S.^[340]

Real median household income increased 1.8% in 2017, to $61,372, the third consecutive annual increase and the second consecutive record high. The rate of increase was slower in 2017 than 2016 (3.1%) and 2015 (5.1%).^[341][342]

The poverty rate for families declined for the third consecutive year in 2017, to 9.3%.^[343][344]

Household Economic Well-Being

In its annual Report on the Economic Well-Being of U.S. Households released on May 22, 2018, the Federal Reserve found that 74% of surveyed adults were either "doing okay" or "living comfortably" in 2017, up from 70% in 2016, the fourth consecutive increase since the Fed first asked that survey question in 2013.^{[345][346][347]}

Effect of gas prices

Gas prices rose from $2.34/gallon in May 2017 to $2.84 in May 2018, cutting into the tax cut savings. Economist Mark Zandi stated: "If the 50-cent per gallon increase in gas prices remains, it would cost the average American $450 a year, offsetting about half the tax [cut] benefit." President Trump's withdrawal from the Iran nuclear deal was one factor in the increase in gas and oil prices, along with quotas established by OPEC in the face of an economy growing worldwide.^[348]

SNAP participation

In July 27, 2018 remarks about the economy, Trump stated, "More than 10 million additional Americans had been added to food stamps, past years. But we've turned it all around." SNAP participation had been steadily declining since December 2012.^[349][350]

Homelessness

HUD reported in December 2017 that homelessness increased 0.7% in 2017, the first annual increase since 2010.^[351]

Early economic plan

On the federal personal income tax, Trump has proposed collapsing the current seven brackets (which range from 10% to 39.6%) to three brackets of 10%, 20%, and 25%; increasing the standard deduction; taxing dividends and capital gains at a maximum rate of 20%; repealing the alternative minimum tax; and taxing carried interest income as ordinary business income (as opposed to existing law, which provides for preferential treatment of such income).^[360][361] With respect to business taxes, Trump has proposed reducing the corporate tax rate to 15%; limiting the top individual income tax rate on pass-through businesses such as partnerships to no more than 15%; repealing most business tax breaks as well as the corporate alternative minimum tax; imposing a "deemed repatriation tax" of up to 10% of accumulated profits of foreign subsidiaries of U.S. companies on the effective date of the proposal, payable over 10 years; and taxing future profits of foreign subsidiaries of U.S. companies each year as the profits are earned (i.e., ending the deferral of income taxes on corporate income earned in other countries).^[360][361] Trump has also called for the repeal of the federal estate tax and gift taxes and for capping the deductibility of business interest expenses.^[360][361]

Detailed analyses by both two nonpartisan tax research organizations, the conservative Tax Foundation and centrist Tax Policy Center, concluded that Trump's tax plan would "boost the after-tax incomes of the wealthiest households by an average of more than $1.3 million a year" and significantly lower taxes for the wealthy.^[360][362] The Tax Policy Center "calculated the average tax cuts for the rich and the very rich" under Trump's plan as "$275,000 or 17.5 percent of after-tax income for the top 1 percent, and $1.3 million or nearly 19 percent for the top 0.1 percent (those making over $3.7 million)."^[363]

An analysis by Citizens for Tax Justice found that under Trump's plan, the poorest 20% of Americans would see a tax cut averaging $250, middle-income Americans would see a tax cut averaging just over $2,500, and the best-off 1% of Americans would see a tax cut averaging over $227,000.^[361] CTJ determined that 37% of Trump's proposed tax cuts would benefit the top 1%.^[363]

Trump's claims that his tax plan would be "revenue neutral" have been rated "false" by PolitiFact, which found that "Free market-oriented and liberal groups alike say Trump's tax plan would lead to a $10 trillion revenue loss, even if it did create economic growth."^[364] An analysis by the Tax Foundation indicated that Trump's tax proposal would increase economic growth by 11% and wages by 6.5%, and create 5.3 million jobs, while decreasing revenue by $10 trillion over a decade.^[365] Prominent anti-tax activist Grover Norquist of Americans for Tax Reform called Trump's tax proposal a "pro-growth, Reaganite plan";^[366] as of May 2016, Trump has not signed Norquist's no-new-taxes pledge, but has indicated that he will in the future.^[367]

Trump has pledged to balance the budget in five years;^[368] not cut Social Security or Medicare; increase defense spending; and enact tax cuts that would lose $9.5 trillion of revenues over the next decade. Economist Jared Bernstein notes that it is mathematically impossible to fulfill all of these pledges, writing: "Trump would need to cut spending outside the Social Security, Medicare, and defense by 114 percent to make his budget balance, which is, of course, impossible."^[369] Bernstein, a senior fellow at the Center on Budget and Policy Priorities, stated a proposal "loses probably something in the neighborhood of $5 trillion in revenue over 10 years with regressive tax cuts that exacerbate the inequalities that already exist in our economy."^[370] The fact-checking website PolitiFact similarly concluded: "Trump's tax plan means either unprecedented spending cuts or increased federal borrowing. But Trump has released no details about the gap, all the while vowing to protect Social Security and Medicare, two of the largest line items on the federal budget."^[363]

An analysis of Trump's campaign proposals by the Committee for a Responsible Federal Budget (CRFB) showed that Trump's key proposals would increase the debt by between $11.7 and $15.1 trillion to the U.S. national debt over the next 10 years, with the U.S.'s debt-to-GDP ratio rising from 115% to 140% of GDP. The CRFB analysis showed that "growth would have to be roughly 5 times as large as projected, and twice as high as the fastest growth period in the last 60 years (which was between 1959 and 1968)" in order to balance the budget under Trump's plan, which is "practically impossible."^[371][372]

Trump has vowed "tremendous cutting" of budgets for the U.S. Environmental Protection Agency and the U.S. Department of Education if elected.^[373] However, Trump has "proposed large spending increases in certain areas," which the Center for Budget and Policy Priorities states would mean "even deeper cuts to other programs" if such spending increases are to be offset.^[374]

On May 9, 2016, Trump said on Meet the Press: "The thing I'm going to do is make sure the middle class gets good tax breaks. For the wealthy, I think, frankly, it's going to go up. And you know what, it really should go up." The following day, Trump backtracked on his comment on taxation of the wealthy, "saying he had been referring to potential adjustments to his own tax policy proposal" and did not support an increase in taxes of the wealthy from current levels.^[367][375] Trump's has frequently throughout his presidential campaign changed his view as to whether the wealthy should see tax cuts or increases.^[376]

Economic growth

Economic forecast scenarios from 2016–2026, based on a modified version of Trump's stated campaign policies as of June 2016 (orange line) are compared to the current law baseline (green line). The orange line is a scenario referred to as "Trump Lite" by Moody's Analytics, in which more moderate versions of Trump's policies are hypothetically implemented.^[377]

Trump's campaign claimed that the combination of income tax cuts, deregulation, trade protectionism, and additional spending for defense and infrastructure would significantly increase economic growth and job creation.^[378] During Trump's first 100 days as president, the federal total public debt decreased by $101 billion, although it increased $546 billion over his first year.^[379]

• According to a report by Moody's Analytics, released in June 2016, the implementation of Trump's stated economic policies would make the U.S. economy "significantly weaker" following an initial boost:

Under the scenario in which all his stated policies become law in the manner proposed, the economy suffers a lengthy recession and is smaller at the end of his four-year term than when he took office (see Chart). By the end of his presidency, there are close to 3.5 million fewer jobs and the unemployment rate rises to as high as 7%, compared with below 5% today. During Mr. Trump's presidency, the average American household's after-inflation income will stagnate, and stock prices and real house values will decline. Under the scenarios in which Congress significantly waters down his policy proposals, the economy will not suffer as much, but would still be diminished compared with what it would have been with no change in economic policies.^{[377][380][381]}

The Trump campaign disputed Moody's analysis, arguing that the report was based on flawed assumptions about proposals that have not been fully fleshed out and that Trump's tax cuts and deregulation proposals would help stimulate the economy. A Trump adviser also asserted that the costs of Trump's trade and immigration proposals had been overweighted in the analysis by not factoring in how current policies have depressed the wages of U.S. workers.^[381]

• According to an analysis by the British research firm Oxford Economics, U.S. economic growth would slow to about 0.3 percent annually – the worst pace since the end of the recession – after two years of Trump's stated policies.^[382] In the absence of Trump's policies, the U.S. economy would be $430 billion larger after five years.^[382] Global economic growth would decline to about 2.2 percent annually, compared to a forecast of 2.9 percent if Trump's policies were not implemented.^[382] The Oxford Economics analysis diverges from the Moody's analysis in that the former assumes that the Federal Reserve would help to mitigate the ramifications of Trump's policies by keeping interest rates close to zero.^[382]
• According to an analysis by the Peterson Institute for International Economics, Trump's proposed tariff increases on China and Mexico could, if China and Mexico retaliate with their own tariff increases, push the U.S. into recession and cost 5 million U.S. jobs.^[383] Even more limited retaliation by China and Mexico, or an aborted trade war (the Trump administration backs down from its tariff increases one year into them) would hit the U.S. economy hard.^[383] Gary Clyde Hufbauer, senior fellow at PIIE, notes that there is ample precedent and scope for a U.S. president to unilaterally raise tariffs as Trump has vowed to do, and that efforts to block Trump's actions through the courts, or by amending the authorizing statutes in Congress, would be difficult and time-consuming.^[384]
• According to an analysis by University of Michigan economist Justin Wolfers of stock market movements during the first Presidential Debate, the market performs far more poorly when Trump's chances of becoming President are higher.^[385] The analysis shows that Wall Street traders expect the profitability of America's largest businesses to be about 10 to 12 percent lower on average in the event of Trump presidency.^[385]
• According to a Financial Times survey of economists, just under 14% of the economists polled between July 28–29 said a Trump victory in November would be positive for U.S. economic growth (compared with roughly 70% for Clinton).^[386] According to a survey of National Association for Business Economics (NABE) members, 14% of business economists feel that Trump would do the best job as president of managing the U.S. economy (with 55% choosing Clinton, 15% choosing Gary Johnson, and 15% saying that they did not know or did not have an opinion).^[387] According to a survey by The Wall Street Journal, none of the 45 former members of the White House Council of Economic Advisers—spanning eight presidents—openly support Mr. Trump.^[388] According to the Financial Times, "most mainstream economists view his economic policies as dangerous quackery."^[389]
• 370 prominent economists, including 8 Nobel laureates, have signed a letter warning against the election of Donald Trump, calling him a "dangerous, destructive choice" for the country.^[390] The letter said that he had not proposed credible solutions to reduce budget deficits, that he has promoted misleading claims about trade and tax policy, chided him for failing to "listen to credible experts" and for promoting "magical thinking and conspiracy theories over sober assessments of feasible economic policy options."^[390]
• According to a November 2016 survey of leading economists, not a single respondent believed that Trump's 100-day plan ("Seven actions to protect American workers") was likely to benefit middle-class Americans, and only one economist believed that it was likely to improve the lives of low-skilled Americans.^[391]
• Former Treasury Secretary Lawrence Summers wrote in June 2017 that: "We may have our first post-rational president. Trump has rejected the view of modern science on global climate change, embraced economic forecasts and trade theories outside the range of reputable opinion, and relied on the idea of 'alternative facts' rather than evidence-based truth."^[392]

Taxation

National debt

Projected effect of Trump's plans on the debt-to-GDP ratio over ten years, as calculated Moody's Analytics (light blue line) and the Committee for a Responsible Federal Budget (orange line). The black line is the projection under current policy (as calculated by the Congressional Budget Office), which is similar to the CRFB's projection for the policies of Trump's rival, Clinton.^[371]

In 1999 Trump proposed a massive one-time "net worth tax" on the rich to wipe out the national debt.^[416] Elizabeth Warren and Paul Krugman initially agreed with Trump's early positions on taxing the wealthy,^[417][418] but not his published positions going into the election, which dramatically reduced taxes for the wealthy. Paul Krugman wrote in May 2016: "Last fall Mr. Trump suggested that he would break with Republican orthodoxy by raising taxes on the wealthy. But then he unveiled a tax plan that would, in fact, lavish huge tax cuts on the rich. And it would also, according to non-partisan analyses, cause deficits to explode, adding around $10 trillion to the national debt over a decade."^[419] In 2011 Trump called for a balanced budget amendment,^[420] but it was not part of his campaign website policies.^[378]

Economist Mark Zandi estimated that if Trump's tax cuts and spending increases were fully implemented as proposed, the national debt trajectory would worsen considerably, with debt held by the public rising from 76% GDP in 2016 to 135% GDP in 2026, considerably above a current policy baseline that rises to 86% GDP in 2026. If only some of Trump's policies were implemented under an alternative scenario of more moderate changes, the debt figure would rise to 111% GDP by 2026.^[377] In May 2016, the Committee for a Responsible Federal Budget placed the 2026 debt figure under Trump's policies between 111% GDP and 141% GDP, versus 86% under the current policy baseline.^[371]

In two interviews in May 2016, Trump suggested that he would "refinance" the U.S. federal debt as a means to relieve the debt.^[421][422] Trump said that he would not seek to renegotiate the bonds,^[421] but rather would seek to buy the bonds back at a discount.^{[421][423][424]} Economists and other experts variously described Trump's debt proposal as incoherent,^[421] fanciful,^[423] and reckless,^[424] stating that the proposal, if carried into effect, "would send interest rates soaring, derail economic growth and undermine confidence in the world's most trusted financial asset."^[424] Tony Fratto, a former U.S. Treasury Department who served under George W. Bush, termed Trump's suggestion to refinance the U.S. debt "an insane idea" that "would cause creditors to rightly question the 'full faith' commitment we make."^[424] The New York Times reported that: "Repurchasing debt is a fairly common tactic in the corporate world, but it only works if the debt is trading at a discount. If creditors think they are going to get 80 cents for every dollar they are owed, they may be overjoyed to get 90 cents. Mr. Trump's companies had sometimes been able to retire debt at a discount because creditors feared they might default ... However, the United States simply cannot pursue a similar strategy. The government runs an annual deficit, so it must borrow to retire existing debt. Any measures that would reduce the value of the existing debt, making it cheaper to repurchase, would increase the cost of issuing new debt. Such a threat also could undermine the stability of global financial markets."^[425]

Social Security and Medicare

Trump has called for allowing Medicare to negotiate directly with prescription-drug companies to get lower prices for the Medicare Part D prescription-drug benefit, something currently prohibited by law. Trump has claimed on several occasions that this proposal would save $300 billion a year. Glenn Kessler, the fact-checker for the Washington Post, gave this statement a "four Pinocchios" rating, writing that this was a "truly absurd" and "nonsense figure" because it was four times the entire cost of the Medicare prescription-drug system.^[426] Trump abandoned the plan in May 2018, as well as his campaign promise to allow Americans to import cheaper pharmaceuticals from foreign countries.^[427]

Unlike his rivals in the 2016 Republican primary race, Trump opposes cuts in Social Security and Medicare benefits.^[428][429] This is a departure from Trump's earlier views; in his book published in 2000, Trump called Social Security a "Ponzi scheme" and said it should be privatized.^[429] Trump previously proposed raising the Social Security retirement age to 70 from 67, but he backed away from this stance in 2015, instead claiming that Social Security should be funded by canceling foreign aid to anti-American countries.^[429] In fiscal 2015, total spending for "international affairs" comprised 1.3% of all federal government spending, while Social Security comprised 24.1%.^[430]

Monetary policy

Financial regulation and other regulations

In May 2016, Trump said that if elected president he would dismantle "nearly all" of the Dodd–Frank Wall Street Reform and Consumer Protection Act, a financial regulation package enacted after the financial crisis.^[445] Trump called Dodd-Frank "a very negative force."^[445] Trump told Reuters that he will release his own financial regulation plan in the beginning of June 2016.^[446]

Trump promised to roll back existing regulations and impose a moratorium on new regulations, with a specific focus on undoing environmental rules that he said curtail job creation.^[3][447] The Wall Street Journal noted that, "It isn't clear how such a moratorium would apply to financial regulators, whose agencies enjoy greater independence from the executive branch" and that he "made no mention of past calls to repeal or replace parts of the Dodd-Frank financial-regulatory overhaul."^[447] In October 2016, Trump proposed to eliminate as many as 70 percent of federal agency regulations.^[448]

Trade policy

Peter Navarro, Director of the White House National Trade Council, addresses President Donald Trump's promises to American people, workers, and domestic manufacturers (Declaring American Economic Independence on 6/28/2016) in the Oval Office with Vice President Mike Pence and Secretary of Commerce Wilbur Ross before President Trump signs Executive Orders regarding trade in March 2017^[449][450]

When announcing his candidacy in June 2015, Trump said that his experience as a negotiator in private business would enhance his ability to negotiate better international trade deals as President.^[451][452] Trump identifies himself as a "free trader,"^[453] but has been widely described as a "protectionist".^{[454][455][456][457][458]} Trump has described supporters of international trade as "blood suckers."^[459] According to the New York Times, since at least the 1980s, Trump has advanced mercantilist views, "describing trade as a zero-sum game in which countries lose by paying for imports."^[460] On the campaign trail in 2015 and 2016, Trump has decried the U.S.-China trade imbalance—calling it "the greatest theft in the history of the world"—and regularly advocates tariffs.^[460] Economists dispute the idea that a trade deficit amounts to a loss or "theft", as a trade deficit is simply the difference between what the United States imports and what it exports to a country.^[461][462] Trump shares some views on trade with Bernie Sanders, at least in the sense that they both are skeptical of free trade.^[452] When asked why the clothes in the Donald J. Trump collection were not made in the United States, Trump answered that "They don't even make this stuff here," a claim found to be false by FactCheck.org.^[463]

Trump's views on trade have upended the traditional Republican policies favoring free trade.^[454][464] Binyamin Appelbaum, reporting for the New York Times, has summarized Trump's proposals as breaking with 200 years of economics orthodoxy.^[460][465]

A number of economists and free-market proponents at groups such as the Institute of Economic Affairs, American Enterprise Institute, Peterson Institute for International Economics, Adam Smith Institute, Cato Institute, Center for Strategic and International Studies, and Club for Growth have been harshly critical of Trump's views on trade, viewing them as likely to start trade wars and harm consumers.^{[465][466][467][468][469][470][471][472][473][474]} According to economists consulted by the Los Angeles Times, recent U.S. experience with imposing tariffs on goods has had little to no positive impact on the protected industries and harmed consumers through higher prices.^[475]

Research shows that the mere threat of tariffs adversely affects international trade flows by creating policy uncertainty, so even if Trump never ends up enacting his proposed tariffs, the threat alone "is likely already discouraging potential exporters around the world from attempting to enter the US market."^[476]

On March 6, 2018, Trump's director of the National Economic Council and former chairman of Goldman Sachs, Gary Cohn, announced his intention to resign. The announcement followed the president's proposal to impose import tariffs on steel and aluminum and Trump's cancellation of a meeting with end-users of steel and aluminum that Cohn had arranged in an attempt to dissuade the president from the planned tariffs.^[477] Later that day, Cohn did resign his White House position, effective immediately.^[478]

Trade with China

Main article: 2018 China–United States trade war

U.S. manufacturing and construction employment.

In January 2016, Trump proposed a 45 percent tariff on Chinese exports to the United States to give "American workers a level playing field."^[453][460] According to an analysis by Capital Economics, Trump's proposed tariff may hurt U.S. consumers by driving U.S. retail price of Chinese made goods up 10 percent, because of few alternative suppliers in key product classes that China sells to the U.S.^[482] The Economic Policy Institute (EPI) reported in December 2014 that "Growth in the U.S. goods trade deficit with China between 2001 and 2013 eliminated or displaced 3.2 million U.S. jobs, 2.4 million (three-fourths) of which were in manufacturing." EPI reported these losses were distributed across all 50 states.^[483]

Trump has vowed to label China as a currency manipulator on his first day in office.^[464] Washington Post fact-checker Glenn Kessler, citing experts such as C. Fred Bergsten, found that "Trump's complaints about currency manipulation are woefully out of date," noting that "China has not manipulated its currency for at least two years."^[484]

Trump has pledged "swift, robust and unequivocal" action against Chinese piracy, counterfeit American goods, and theft of U.S. trade secrets and intellectual property; and has condemned China's "illegal export subsidies and lax labor and environmental standards."^[464] When asked about potential Chinese retaliation to the implementation of tariffs, such as sales of U.S. bonds, Trump deemed the Chinese unlikely to retaliate, "They will crash their economy ... They will have a depression, the likes of which you have never seen if they ever did that."^[485] In a May 2016 speech, Trump responded to concerns regarding a potential trade war with "We're losing $500 billion in trade with China. Who the hell cares if there's a trade war?"^[486]

Income inequality

Share of income of the top 1% for selected developed countries, 1975 to 2015.

Four charts that describe trends in income inequality in the United States.

In September 2016, Trump said: "We reject the pessimism that says our standard of living can no longer rise, and that all that's left to do is divide up and redistribute our shrinking resources."^[495] However, U.S. household and non-profit net worth has approximately doubled from 2000 to 2016, from $44 trillion to $89 trillion, a record level, according to the Federal Reserve.^[496] In addition, the Congressional Budget Office reported in June 2016 that federal income taxes are progressive, which reduces after-tax income inequality. For example, the top 1% received approximately 15% of before-tax income but 12% of after-tax income during 2013.^[497] Economist Mark Zandi wrote in June 2016 that due to the sizable income tax cuts, "[t]he tax code under Mr. Trump's plan will thus be much less progressive than the current tax code."^[377]

Economic history

In October 2016, after it was revealed that Trump reported $916 million losses during the 1990s, Trump asserted that the 1990s were "one of the most brutal economic downturns in our country's history", "an economic depression" and that the only period coming close it was the Great Depression. Those assertions are false, the Associated Press claimed in a fact check. For instance, the Great Recession, which began in 2007, had lasted far longer and had far worse economic consequences than the recession of the early 1990s, the check reported.^[498] Four of Trump's major property holdings declared bankruptcy in 1991 and 1992.^[499]

In a February 9, 2009 appearance on Fox News, Trump praised President Obama and his proposed economic stimulus bill, stating, "This is a strong guy knows what he wants, and this is what we need ... I have analyzed the bill as closely as it can be analyzed in this quick a period of time, but he's really got a combination of both [tax relief and spending]."^[500]

Trump has repeatedly claimed to have predicted the Great Recession.^[501] However, Trump in the years preceding the Great Recession said precisely the opposite, namely that "the economy continues to be fairly robust," "real estate is good all over," "the real estate market is going to be very strong for a long time to come," "I've been hearing about this bubble for so many years ... but I haven't seen it," and "this boom is going to continue", according to a separate check published by Politico Magazine.^[501]

Student loans

During the 2016 Republican National Convention Trump said, "We're going to work with all of our students who are drowning in debt to take the pressure off these young people just starting out their adult lives".^[502] The Trump campaign did not put forth an official higher education plan, reported NASFAA.^[503] However, In May 2016 Trump's campaign co-chair, Sam Clovis stated that the ideas being prepared by the campaign included getting government out of student lending; requiring colleges to share in risk of loans; discouraging borrowing by liberal arts majors; and moving the Office of Civil Rights from the Education Department to Justice Department.^[504] In an October 2016 speech, Trump said that he favored having student loans repayment capped at 12.5 percent of borrowers' income, with forgiveness of any remaining debt after fifteen years of payments.^[503][505]

Trump has criticized the federal government for earning a profit from federal student loans.^[506] Prior to 2010, private banks made most student loans and kept the profits while taxpayers bore the default risk through government guarantees; legislation promoted by President Obama eliminated the banks' role, making the federal government a direct lender that kept the profits for bearing the risk.^[507] Trump's campaign stated that all colleges should have "skin in the game" and share the risk associated with student loans. The campaign opposed Hillary Clinton's proposal for debt-free public higher education, Bernie Sanders's plan for free public higher education and President Obama's proposals for a state-federal partnership to make community college free for new high school graduates, citing federal budget concerns.^[504]

Infrastructure

Trump supports investment in American infrastructure to help create jobs.^{[508][509][510][511]} He wrote in his 2015 book Crippled America that "Our airports, bridges, water tunnels, power grids, rail systems—our nation's entire infrastructure is crumbling, and we aren't doing anything about it." Trump noted that infrastructure improvements would stimulate economic growth while acknowledging "on the federal level, this is going to be an expensive investment, no question about that."^[510][511] In an October 2015 interview with the Guardian, Trump stated: "We have to spend money on mass transit. We have to fix our airports, fix our roads also in addition to mass transit, but we have to spend a lot of money."^[512] In a Republican primary debate in December 2015, Trump said: "We've spent $4 trillion trying to topple various people. If we could've spent that $4 trillion in the United States to fix our roads, our bridges and all of the other problems—our airports and all of the other problems we've had—we would've been a lot better off."^[510]

On the campaign trail, Trump has decried "our airports, our roads, our bridges," likening their state to that of "a Third World country."^[513][514] Trump has on some occasions overstated the proportion of U.S. bridges that are structurally deficient.^[513] Unlike many of his Republican opponents,^[512] Trump has expressed support for high-speed rail, calling the U.S.'s current rail network inferior to foreign countries' systems.^[509][512]

Trump proposes he would spend $800 to a trillion dollars to repair and improve the nation's infrastructure. His plan to raise said capital, is to create an infrastructure fund that would be supported by government bonds that investors and citizens could purchase, similar to Build America Bonds.^[515] This approach aims at harnessing private capital to leverage government spending on infrastructure at federal, state and local level, thus relying on the notion of "infrastructure as an asset class" for private investors initially developed in Northern Europe, Canada and Australia^[516][517]

When Trump was asked on Fox & Friends about supporting Russia's idea on a Bering Strait tunnel project, he replied: "I wouldn't be opposed to any idea that can create jobs."^[518][519]

Employment

U.S. total nonfarm payroll job creation, monthly average in thousands for 2013 to 2017 (thru November), from the Federal Reserve Economic Data (FRED).^[119]

CBO explanation for shortfall in employment of 2.5 million relative to a theoretical full employment level.^[520]

In a survey conducted by DHI Group in January 2017, a majority of employers don't expect any near-term change in hiring plans due to the recent U.S. Presidential election. Around 12 percent anticipated an increase in hiring due to the incoming Trump administration proposed initiatives to accelerate the economy such as corporate tax reform.^[521]

During an economic speech on September 15, 2016, Trump proposed tax cuts, infrastructure investment, reduced regulations, and revised trade agreements which he claimed would create 25 million jobs over ten years. Trump also stated: "Right now, 92 million Americans are on the sidelines, outside the workforce, and not part of our economy. It's a silent nation of jobless Americans."^[495] Other politicians and commentators have repeated this assertion after it had been repeatedly debunked; most of the people in the figure do not work by choice or because they cannot work, such as retirees, students, stay-at-home parents and the disabled.^{[522][523][524]} The Congressional Budget Office has estimated that the U.S. was approximately 2.5 million jobs below full employment as of December 2015, primarily as a result of a labor force participation rate among prime working-aged persons (aged 25–54 years) that remains moderately below pre-crisis (2007) levels. The overall labor force participation rate has been falling since 2000, as the country ages.^[520]

In December 2015, the Bureau of Labor Statistics (BLS) reported the reasons why persons aged 16+ were outside the labor force, using the 2014 figure of 87.4 million: 1) Retired – 38.5 million or 44%; 2) Disabled or Illness – 16.3 million or 19%; 3) Attending school – 16.0 million or 18%; 4) Home responsibilities – 13.5 million or 15%; and 4) Other Reasons – 3.1 million or 5%.^[525] As of November 2016, BLS estimated that 90 million of the 95 million people outside the labor force indicated they "do not want a job now."^[526]

Trump has repeatedly questioned official employment numbers, suggesting at different times that the actual unemployment rate could be as high as 18–20%, 24% or 42%.^[527][528] Fact-checkers note that these claims are false; the Washington Post fact-checker called them "absurd" and gave them "Four Pinocchios," its lowest rating for truthfulness, while PolitiFact gave the statement its "Pants on Fire" rating, noting that even the broadest measure of unemployment and underemployment was far below Trump's claimed figures.^[528][529] As of August 2016, the unemployment rate (U-3) was 4.7%. A wider measure of unemployment (U-6) that includes those working part-time for economic reasons and marginally attached workers, was 9.7%. The December 2007 (pre-crisis) levels were 5.0% and 8.8% for these two measures, respectively.^[530] Upon receiving a positive jobs report in Trump's first full month in office, press secretary Sean Spicer told reporters, "I talked to the president prior to this, and he said to quote him very clearly: They may have been phony in the past, but it's very real now."^[531]

Other economic topics

Advisors

Trump released a list of his campaign's official economic advisers in August 2016,^{[568][569][570]} which was significantly anti-establishment^[571] and therefore included few people with any governmental experience,^[572] yet at the same time aimed to include some of the elites of business and finance,^[568] primarily people with well-known names. Although most of the names were new, existing Trump advisers David Malpass, Peter Navarro, Stephen Moore, and Dan DiMicco were also on the list, formally led by Stephen Miller, the national policy director, and directly led by deputy policy director Dan Kowalski. The Trump'16 finance director Steven Mnuchin was also listed, and played a role in helping coordinate the group.

Many of the names on the original list, or on the subsequent expansions thereof,^[573] received media attention as potential cabinet-level appointees, for instance to the presidential Council of Economic Advisers, or in other Trump administration roles. After the election, Trump became president-elect, and in addition to nominating and appointing advisors to formal statutory roles within the Trump administration, also began working on efforts to directly communicate with business leaders, including those in the tech industry, in the broader business world, and in the agricultural sector.

Trump's cabinet will have no economists after his decision in February 2017 to not include the chairman of the Council of Economic Advisers in his cabinet. Obama had elevated the chairman position to a cabinet rank during his administration.^[574][575]