Donald Trump, the president-elect of the United States, won the general election on November 8 by earning more Electoral College votes than Democratic nominee Hillary Clinton. Clinton won the popular vote but lost the presidential race to Trump. Every white working class American, the white poor, and those who are economically struggling are predicted to have some hard days ahead of them.
During his presidential campaign, Trump has remained very vocal about his economic agenda that will increase the ranks of the uninsured by tens of millions. His economic agenda is said to eradicate safety net programs for moderate and low-income Americans. The new refined economic policies are estimated to hurt not only the rich but every American and in a way, it will be affecting the entire world.
Donald Trump’s Trade War Is Going To Cost Millions Of Jobs?
Trump’s 2016 presidential campaign received unprecedented media coverage both domestically and internationally. His statements on renegotiating U.S.-China trade deals and the Trans-Pacific Partnership have been received with mixed responses from across America.
His campaign promise to “make America great again” included a threat of a 45 percent import tariff on Chinese goods and up to 35 percent on goods from Mexico.
“We can’t continue to allow China to rape our country,” he said during one of his rallies in Indiana. “That’s what they’re doing. It’s the greatest theft in the history of the world.”
The Peterson Institute tried to estimate the economic cost of Trump’s trade plans in their report in September. According to the institute, if America renegotiated tariffs, China and Mexico as well as other countries would retaliate with change in tariffs of their own.
The Peterson Institute further concluded that if the developed countries will retaliate by changing the tariffs on their goods, then it would likely cause a full-on trade war, and there are chances that the world will encounter another recession by 2019.
“In a full trade war scenario, Washington State would be the worst affected, suffering a five percent private sector job loss relative to baseline. But employment would fall by more than four percent in a broad swath of states, including California, Connecticut, Indiana, Illinois, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, New Hampshire, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Texas, Utah, and Wisconsin. Twenty-nine counties across America would experience employment declines of seven percent or more. In absolute terms, Los Angeles county in California would be the worst affected (176,000 jobs), followed by Cook county, Illinois (Chicago) with 91,000 and Harris county, Texas (Houston) with 89,000.”
After Trump’s win in the presidential election, The Global Times, a Chinese state-run newspaper, warned the world that Beijing would take a “tit-for-tat approach,” if the new president tries to make radical changes in the import-export policies.
“A batch of Boeing orders will be replaced by Airbus, U.S. auto and iPhone sales in China will suffer a setback, and U.S. soybean and maize imports will be halted,” reads the paper. “China can also limit the number of Chinese students studying in the U.S.”
The new tariffs will likely disrupt the supply chain — resulting in the dramatic increase in the cost of goods. This increase in costs is said to directly hit working class Americans who have low income.
Donald Trump Redefining America’s Tax-System
America’s future president’s campaign site promises that he will cut taxes for a married couple with two kids, $50,000 in earnings and $8,000 in child care expenses by a gargantuan 35 percent. He also proposes to replace the current seven-bracket income tax structure with just three: 12 percent, 25 percent and 33 percent.
According to a paper published by NYU Law’s Lily Batchelder, families with two kids would only get to see their tax to go down by a mere $93, or 0.2 percent of their total income.
Lily provided several examples of families that prove that Donald Trump has exaggerated the size of the tax cuts.
- A single parent who earns $75,000, with two children currently in school, would face a tax increase of $2,440.
- If the family had $8,000 in child care costs eligible for his proposed deduction, they would still have to pay $1,640 more in taxes.
- A hypothetical family with $50,000 in earnings, with two of their children in school, would pay $150. And a family would face a tax increase of $450 if they have three children.
Apart from the middle-class families, investors and big corporations would do extremely well under his plans. According to the Tax Policy Center, Donald Trump promises to slash the corporate tax rate from its current peak at 35 percent.
As many of the economic pundits know for a fact that the corporate tax is more progressive than the individual tax, the proposed change will certainly increase the income inequality.
He has openly faced criticism and has asked fellow citizens to give him a chance to make America great again. All of his policies during his presidential campaign are only the proposed ones and as soon as he takes the oath for the oval office, it will be interesting to see his upcoming moves.
What are your views on the proposed policies by Donald Trump? Sound off your views in the comments below.
[Featured Image by Sara D. Davis/Getty Images]