Trump’s Blue Collar Tax Reform Boom Restored — but Biden and Harris want only repeal
By Lewis K. Uhler and Peter J. Ferrara, National Tax Limitation Foundation
Tax Reform in the form of the 2017 Tax Cuts and Jobs Act is supporting booming economic growth to this day. Just reported third quarter numbers set an all time record: 33.1% growth over the second quarter, for a 7.4% annualized rate. Forget about 5% real growth, which was the previous annual target for free market tax cutting conservatives.
Biden-Harris’s alliance with Bernie Sanders and AOC, as represented in their campaign manifesto, abandons Blue Collar families for the extremist ideology of socialism. In sharp contrast, Trump has America on the right course with plunging unemployment, near zero interest rates with no inflation, and renewed, booming economic growth. At 7% real growth, the world leading American economy would double in just 10 years.
At the current unemployment rate of 7.9%, two thirds of the job losses caused by the global pandemic have been recovered. The next unemployment report coming the Friday after the election will show unemployment plunging even further. By contrast Europe, where the virus is resurging, is planning new lockdowns which will cause further economic downturns and increasing unemployment.
Here in America, it is Trump’s Blue Collar boom that is currently resurging. The very tax cuts that Biden promises to repeal on day one — with the biggest tax increase in American history, at $4 trillion — along with reversal of Trump’s deregulation, would cause a sharp economic downturn.
On the virus, Biden and the Democrats have been politicizing the pandemic as if it were a Republican idea. They talk about rising case numbers but the important issue is deaths, which have declined 70% over the past 6 months.
The way to address a virus is not through policies of renewed economic contraction but through modern science. America’s world leading pharmaceutical industry is already racing to a vaccine in record time under FDA supervision with companies like Pfizer and Moderna working through Trump’s “Operation Warp Speed”. Therapeutics like Regeneron’s monoclonal antibodies, which Trump himself has used, are also in development.
We don’t need to reverse and repeal the tax cuts, which have worked spectacularly. And we don’t need to reverse Trump’s deregulation. But do need to stop the Green New Deal. Most people don’t know that the Roosevelt’s New Deal never worked to cure the 1930s Depression. To this day, we even call borrowing a trillion dollars from the private sector to increase government spending by the misnomer “stimulus”. But government spending is not what works to promote economic growth and prosperity.
What works is cutting marginal tax rates (the rate on the next dollar of income), deregulation, and stable dollar monetary policy, with low interest rates, zero inflation and no deflation (declining general prices, which we had during the Depression). That is what created Trump’s Blue Collar boom, with the lowest unemployment for ethnic minority groups in American history. Just don’t expect it to continue if Democrats take the White House and Senate.
Lew Uhler is Founder and Chairman of the National Tax Limitation Committee and the National Tax Limitation Foundation (NTLF). He was a contemporary and collaborator of Ronald Reagan and Milton Friedman in California and across the nation. Peter Ferrara is a Senior Fellow for NTLF. He was a member of the White House Office of Policy Development under President Reagan, Associate Deputy Attorney General of the United States under President George H.W. Bush, and formerly Dunn Liberty Fellow in Economics at The King’s College in New York City.