Quantcast

Daily Traders Edge

The GOP tax plan isn’t even a good try at trickle-down economics

November 10
16:13 2017

“The most excited group out there are big CEOs, about our tax plan,” says ex-Goldman Sachs President Gary Cohn, who runs the National Economic Council in the Trump White House, in an interview with CNBC’s John Harwood.

Of course they’re excited: The plan offers big tax cuts on business profits. But Cohn says regular people should be excited about the plan, too, because the benefits from business tax cuts will “trickle down” to them.

Cohn doesn’t seem to realize that “trickle down” has become a pejorative. It’s a term for a tax plan that’s supposed to produce benefits for the middle class that never materialize.

But even if you were trying to design a trickle-down plan — one that targets its business tax cuts according to supply-side theories of how to grow the economy and boost wages — the Republican tax plan fails.

These business tax cuts are poorly targeted. They are not sufficiently focused on encouraging new business investments.

Continue Reading at Business Insider

Related Articles

Newsletter Signup

Sign up for our free newsletter