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Economics Discuss Debt Soars Under President Donald Trump Tax Cuts at the Political Forums; You Tube You Tube How U.S. National Debt Could Blow Up the Trump Economy | Fortune Donald Trump is pitching, ...

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Old 06-27-2018, 01:32 AM
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Default Debt Soars Under President Donald Trump Tax Cuts



How U.S. National Debt Could Blow Up the Trump Economy | Fortune

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Donald Trump is pitching, as only Donald Trump can pitch, that a major economic revival is energizing America for a new run at greatness, and that he’s the straw stirring the elixir. In one representative recent tweet, the President declared, “Our economy is now booming and with all I am doing, will only get better … Our country is WINNING again!”

Though “booming” is Trumpian overstatement, it’s undeniable that by many criteria, the President’s agenda is proving remarkably successful. In Trump’s first three full quarters in the White House, GDP clocked growth just shy of his vaunted goal of 3%, a performance that by recent standards looks stellar. The stock market has added a quarter to its value since the election, a $5 trillion vote of confidence. The jaunty outlook is recharging animal spirits in corner offices: In its January survey of small companies, the National Federation of Independent Business found that 32% of the enterprises rated the present climate “a good time to expand”; that was a record high and a threefold increase from late 2016.

Fueling the giddiness is the President’s signature legislative achievement: the Tax Cuts and Jobs Act, which slashed rates for corporations from 35% to 21%. The new law is a runaway hit with business leaders. Companies as varied as American Airlines (AAL, -1.51%), Walmart (WMT, -0.61%), and Verizon (VZ, -0.63%) predict that the measure will swell their earnings for years to come, and marquee CEOs from JPMorgan Chase’s (JPM, +0.04%) Jamie Dimon to Boeing’s (BA, +0.02%) Dennis Muilenburg laud it as a powerful tonic for American competitiveness. The looming profit surge has prompted more than 200 Fortune 500 companies to raise their minimum pay (U.S. Bancorp, Humana), issue one-time bonuses to employees (Home Depot, Walt Disney), or both.
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Trump’s heady economic potion, however, is masking misguided policies that could leave those same businesses with a severe hangover from today’s celebration. The U.S. government’s huge and growing budget deficits have become gargantuan enough to threaten the great American growth machine. And Trump’s policies to date—a combination of deep tax cuts and sharp spending increases—are shortening the fuse on that fiscal time bomb, by dramatically widening the already unsustainable gap between revenues and outlays. On our current course, we’re headed for a morass of punitive taxes, puny growth, and stagnant incomes for workers—a future that’s the precise opposite of what Trump champions.

By 2028, America’s government debt burden could explode from this year’s $15.5 trillion to a staggering $33 trillion—more than 20% bigger than it would have been had Trump’s agenda not passed. At that point, interest payments would absorb more than $1 in $5 of federal revenue, crippling the government’s capacity to bolster the economy, and constraining the private sector too. Contrary to the claims of the President and his supporters, the U.S. can’t grow fast enough to shed this burden; indeed, Trump’s agenda on immigration and trade looks likely to stunt that growth. (More on that later.) “This is almost like climate change,” says Mark Zandi, chief economist at Moody’s Analytics. “It doesn’t do you in this year, or next year, but you’ll see the ill effects in a day of reckoning.”
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In the absence of decisive, quick action to tackle this slow-motion crisis, the best-case scenario for the next few years is that America becomes a much riskier place to do business. A high debt load will limit our flexibility to keep the economy on an even course. “Countries with high debt don’t respond aggressively to downturns,” says Harvard economist Kenneth Rogoff. If the U.S. slips into recession, we’ll lack the option of lowering taxes or increasing spending on infrastructure, for example, as tools to revive growth. And as the debt load grows, efforts by the Federal Reserve to stimulate the economy with lower rates would be more likely to feed runaway inflation. “Then, investors will dump Treasuries,” says John Cochrane, an economist at the Hoover Institution. “That will drive rates far higher, and make the budget picture even worse.”
read the rest of the Fortune article here

He'd be out of office so he doesn't care.
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The state OF California has a booming economy and $16 billion in surplus and “rainy day” reserves
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Old 06-27-2018, 08:11 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

Revenues are also at record levels. So I suggest you consider an alternate responsibility for the deficit. That Congress is still spending too much.

It was Congress who placed the spending bill on his desk. He signed it with reluctance, but would not hurt the military families with a veto.

You should know that the problem lies with the arm of Government that controls the spending. Or did you not pay attention in school?
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Old 06-27-2018, 08:33 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

As the OP admits Trump's agenda of lowering taxes and reducing regulation along with encouraging businesses to expand has been an undeniable success. It's a stark contrast to Obama's failed stimulus, increased regulation and tax increases. Quick let's forecast doom in the next decade by using static analysis pretending the economy is not multivariable and Federal spending is fixed.

It is typical of Democrat elitists and demagogues to fashion this kind of we need to raise taxes for your own good kind of argument. Trump the arrogant and often crude businessman understands what it took to get the economy moving again but Democrats like Bill Mahr are hoping for the economy to fail as a means of getting rid of Trump.
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Old 06-27-2018, 08:38 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

Taxes are down revenues are up. That is good news in regards to the economy and will do nothing but help to drive down the deficit.

However, that alone will not solve the deficit problem. Congress needs to step up to the plate now and introduce MASSIVE spending cuts. The Federal Gov't is bloated and needs to be taken down a few sizes. They are spending like drunken sailors on leave with no regard for fiscal responsibility.

When people begin to realize that the government is not a charity and is not there to make sure you have a good living, hopefully they will then begin to hold their elected officials accountable for the excessive spending and demand that it be curtailed. I won't hold my breath.
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Old 06-28-2018, 02:39 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

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Originally Posted by FrancSevin View Post
Revenues are also at record levels. So I suggest you consider an alternate responsibility for the deficit. That Congress is still spending too much.

It was Congress who placed the spending bill on his desk. He signed it with reluctance, but would not hurt the military families with a veto.

You should know that the problem lies with the arm of Government that controls the spending. Or did you not pay attention in school?
Revenue FY 2018 (est.) - $3.34 trillion
Spending FY 2018 _____ $7.13 trillion
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Old 06-28-2018, 06:45 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

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Revenue FY 2018 (est.) - $3.34 trillion
Spending FY 2018 _____ $7.13 trillion
You just proved my point. Thanks.
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Old 06-28-2018, 08:14 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

Mine also. Tax cuts are not the problem. Tax increases are a problem because they put a financial burden on the economy.

Spending is the problem here. And raising taxes just adds fuel to the fire. The gluttons in our Congress will spend whatever we send them and more.

That has to stop.

So does the borrowing.

We have leveraged the future of our children and burdened them and their progeny. For that, every voter who supported such candidates should be ashamed.
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Old 06-28-2018, 10:17 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

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Originally Posted by saltwn View Post
Revenue FY 2018 (est.) - $3.34 trillion
Spending FY 2018 _____ $7.13 trillion
And you don't see the problem?
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Old 06-28-2018, 10:23 AM
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Default Re: Debt Soars Under President Donald Trump Tax Cuts

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Originally Posted by FrancSevin View Post
Mine also. Tax cuts are not the problem. Tax increases are a problem because they put a financial burden on the economy.

Spending is the problem here. And raising taxes just adds fuel to the fire. The gluttons in our Congress will spend whatever we send them and more.

That has to stop.

So does the borrowing.

We have leveraged the future of our children and burdened them and their progeny. For that, every voter who supported such candidates should be ashamed.
And that's the problem. When you or I receive a raise or increase in profits, we will use at least part of the windfall to pay off that automobile. Thus giving us an increase in effective income.

Congress will use the money as a down payment to buy a bigger automobile.
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