It’s election time, creating a frenzy of news, debate, and anticipation. The carnival atmosphere brought on by the election will soon be over, and we will adjust to a new set of officials who will be running the government. The mudslinging and animosity that characterized the campaign will die down and people will return to a standard routine.
One big question in every presidential election is how the new president’s policies will influence the economy. The candidates tout their own unique economic policies and plans. It is assumed that the election results are a stamp of approval of the winning candidate’s economic policies. The candidates’ competing economic proposals will have serious – and very different – effects on the U.S. economy and the world’s economy as well.
The Republican Economic Proposal
Donald Trump proposes major tax cuts that his camp believes will incentive people to produce. He also proposes making deep cuts in government spending. He supports limiting immigration and imposing steep tariffs on Chinese and Mexican goods. Trump plans to reduce taxes for working and middle-income Americans. He wants to ensure that wealthy Americans pay their fair share but not so much that it detracts from their ability to compete. He proposes axing special interest loopholes and allowing Americans to deduct childcare costs from their taxes.
The Democratic Economic Proposal
Hilary Clinton proposes revenue through the imposition of higher taxes to the very rich, while offering tax relief for the middle class. She proposes financial measures to offset the costs of childcare, make college education more affordable, and lessen the burden of college loans. She also proposes raising the federal minimum wage (from the current $7.25 per hour to $12 per hour) and making healthcare more affordable. Clinton supports investing $275 billion in infrastructure that aims to create more jobs.
The engine of economic growth in the U.S. is the American consumer. The rise and fall of the economy will depend on consumer confidence and on Americans’ spending ability. The Republican proposal of large tax cuts may incentive customers to spend more and spur bigger economic growth. Cuts must be balanced, however, to curb the ballooning national debt. While many believe that Clinton’s plans will benefit working class Americans, she may have challenges getting measures passed with a Republican-heavy Congress.
Make sure to vote on Election Day. Then throw your support behind the new president as we work together for promising economic policies for America.