Will Biden's tax plan make America stronger or weaker? 3
At a recent campaign rally in Toledo (Ohio), US Democratic presidential candidate Joe Biden asked attendees to honk their car horns if they earned more than $400,000 a year.
Biden has proposed large, aggressive tax increases on high-income earners and large corporations.
Biden and his advisers say the tax hikes would boost growth, by funding a series of spending proposals that would help the economy, such as improving infrastructure and investing in clean energy.
Cars of supporters gathered at Mr. Biden’s campaign rally in Toledo.
Meanwhile, Trump and Republican lawmakers say the opposite, that tax increases of any kind risk derailing the recovery.
Polls show that Americans largely support raising taxes on the rich.
Skepticism comes mainly from Republican critics, but was also raised during an event at ABC last week.
Republicans have long asserted that any Democratic proposal to raise taxes would harm the economy, regardless of whether the situation is booming or busting.
Economists advising Biden’s campaign say they are confident his agenda will boost growth.
`This is an extremely inequitable recession. Many people in high-income groups, and large corporations, are not affected at all,` said Austan D. Goolsbee, Former Chief of Staff of the House Council of Economic Advisers.
If you raise taxes on groups like Biden has proposed `and use the money for the things that Biden is talking about, it won’t slow down growth, it will actually increase it,` Goolsbee said.
Several outlets have analyzed Biden’s plan in recent weeks, estimating how much tax revenue it would generate and whether it would help or hurt the economy.
The most optimistic analysis for Biden comes from Moody’s Analytics.
Some find the impact of taxes on growth to be relatively small.
In an interview, Pomerleau said the pushback from the proposals is minimal because Biden mainly taxes high-income earners, which are not a major driver of economic growth.
Mr. Joe Biden spoke during an election campaign.
Former chairman of Trump’s Council of Economic Advisers Kevin Hassett, former member of the council Casey B. Mulligan, and experts including Timothy Fitzgerald and Cody Kallen see much greater damage to growth in
They predict Biden’s plan to expand health insurance subsidies under the `Affordable Care Act` will discourage Americans from working and earning more.
High-earning owners of such businesses would face additional taxes from raising the wage limit subject to Social Security taxes.
Hassett said in an interview that the study is intended to show how `irrational` it is for Biden to try to implement his plans at a time when the economy is still struggling.
Both Trump and Biden are eager to make their tax plans a campaign issue.
Biden pledged not to increase taxes on people earning less than $400,000 a year.
Biden of course knows the political challenges he faces in implementing this plan.
