President Trump and his Administration’s Council of Economic Advisers have been spreading falsehoods about the impact of the 2017 tax law. Despite their claims, there is no evidence to support the idea that the tax cuts, which primarily benefited the wealthy and corporations, actually boosted the economy during Trump’s first term.
In reality, the original legislation did little to stimulate economic growth before the pandemic hit. Business investment rates actually slowed down after the tax law was enacted, as did consumer spending. Research into the law’s key provisions has also failed to provide any evidence supporting the Trump Administration’s assertions.
While the Trump Administration promised that the corporate rate cut would lead to a $4,000 increase in household income, the Federal Reserve Board discovered that workers in the bottom 90th percentile of their firm’s income scale saw no change in earnings as a result of the tax cut.
Proponents of the 2017 tax law made grand promises about its potential to boost the economy, but these promises never materialized. There was no significant impact on GDP growth, investment, or wages. Instead, the tax law ended up reducing federal revenues and widening income and wealth inequality by favoring households in the top 1 percent.
When combined with cuts to Medicaid and SNAP, as well as sweeping tariffs, the 2017 tax law will ultimately lead to higher costs for low- and moderate-income families, while the wealthy continue to enjoy substantial tax breaks. The reality is clear: the 2017 tax law failed to deliver on its promises of economic growth and prosperity for all.
Blue Press Journal 