If we only looked at certain economic statistics, we might certainly believe, the United States, is experiencing, an economy, like never seen before. Unemployment is at an all – time (or nearly) low, and the Gross Domestic Product, or GDP, is historically, very strong. Inflation, and interest rates are low, and the stock exchanges, are booming. So, why does it seem, to many, the economy is nor nearly as good, as those numbers indicate? Is this, merely, a so – called, bubble, created, largely, by the trillion dollars, per year, which the tax legislation/ reform, has pumped into the economy, or is it real? Will Trickle Down Economics, work, for the first time, in the history of the United States? With that in mind, this article will attempt to, briefly, consider, examine, review, and discuss, whether, we are witnessing, a truly great economy, or one based on artificial stimulation, and apparent, bells – and – whistles.
1. Impact of the 2017 Tax Legislation: In the immediate – term, some Americans have benefited, from the 2017 tax reform, others treaded – water, and some (especially, those who usually itemize deductions, live in high – SALT states, and earn under $500, 000 per year), are paying more income taxes. The major beneficiaries of this legislation, have been the largest corporations, which, we were promised, would use it, to hire more people, and provide, more and better jobs. However, what occurred, in most cases, is, these corporations, either, bought – back their stocks, or raised dividends, to their shareholders, while doing very little, in terms of quality employment. While we have witnessed, far fewer unemployed, we’ve also noticed a significantly wider gap, between the haves, and have – nots! This has, been, largely, based on, the Trickle Down Economic theory, which, has always, failed, in the longer – term, when attempted in this country’s past. The last time, a major change, was made, based on this philosophy, was in the 1980’s, during the administration of President Ronald Reagan. What his many supporters, fail to remember, is, it created, such a huge budget gap, two years later, the Federal Government, began taxing Social Security benefits (for the first time), in order to make up, for some of the short – fall.
2. The impact of this deficit approach: While the immediate effect, appears, positive, it is probably, far less so! If we look, at the 10 – year, United States figures, the growth in the economy, as well as drop in unemployment, seem to be, in line, today, with the past. A significant percentage of experienced economists, have proclaimed, much of the current gains, are based on the equivalence of pumping the one – trillion dollars, of annual deficit, into the economy. What will this do, in the longer – run, in terms of its impact on future generations, who will have to pay the interest, on these deficits, for years, to come? Is this a sustainable approach, or, merely, focused on populist rhetoric and promises, as well as aiding the wealthiest?
Although today’s economy, may, be doing, apparently well, at least, statistically, is it real, and sustainable? Wake up, America, and pay more attention, and consider the bigger – picture! Why, if we are doing so well, is the gap, between the classes, widening?
Source by Richard Brody