U.S. Budget and Economy

On April 9, 2018, the Congressional Budget Office released The Budget and Economic Outlook: 2018 to 2028 . The next day, the Investor's Business Daily ran an editorial titled It's Official: Trump Tax Cuts Are Boosting Growth And Mostly Paying For Themselves . That editorial begins: When the Congressional Budget Office released its updated budget forecast, everyone focused on the deficit number. But buried in the report was the CBO's tacit admission that it vastly overestimated the cost of the Trump tax cuts, because it didn't account for the strong economic growth they would generate. Further on, the editorial states: The CBO report also makes clear that this faster-growing economy will offset most of the costs of the Trump tax cuts. In a table buried in the appendix of the CBO report, it shows that, before accounting for economic growth, the tax cuts Trump signed into law late last year would cut federal revenues by $1.69 trillion from 2018-2027. But it goes on ...

Taxpayer Examples Cited by Supporters of the Tax Bill In my last post , I looked at several groups of taxpayers who would pay higher taxes under the new GOP tax bill. The Committee on Rules has posted a Summary of the bill , a Joint Explanatory Statement , and the full bill . Since then, however, it seems like Republican members of Congress are focusing more and more on just a couple of examples that show taxpayers who will receive large tax cuts. For example, a Washington Examiner article quotes Mitch McConnell reading an outline of a possible script for an advertisement that he expects will air: “Here’s the commercial against Joe Manchin: ‘Head of household, family of four, making $73,000 a year, gets a $2,000 tax reduction. Now maybe Sen. Manchin that doesn’t sound like a lot of money to you, but for me it’s a 58 percent reduction in my taxes; 58 percent,’” McConnell said, playing the role of ad voiceover. “Or Sen. Heitkamp: ‘Maybe $1,300 doesn’t sound like a lot to you, bu...

Taxpayer Examples Cited by Supporters of the Tax Bill On December 15th, the GOP released its final tax plan . The Committee on Rules has posted a Summary of the bill , a Joint Explanatory Statement , and the full bill . In addition, House Speaker Ryan released an article that states that, with this bill, "the median family income of $73,000 will receive a tax cut of $2,059". This has been repeated many times since then, such as here , here , and here . In fact, this example is the first of three taxpayer examples that were released in November 21st by the Senate Committee on Finance. Following is information for this and the second example, as generated by the interactive application at this link : Example S1 - Family of Four Earning $73,000 Per Year Names Taxes Released After_Tax 1 Current 2018 3,557.50 69,442.50 2 Conference 1,499.00 71,501.00 3 Change -2,058.50 -2059 2,058.50 4 % Change -57.86 ...

Note: This post has been updated to use the final GOP tax bill. On December 15th, the GOP released its final tax plan . The Committee on Rules has posted a Summary of the bill , a Joint Explanatory Statement , and the full bill . A fact sheet on the White House web site lists the following points, among others: The Tax Cuts Act nearly doubles the standard deduction. For individuals, the standard deduction will be increased from $6,500 to $12,000. For single parents, the standard deduction will be increased from $9,550 to $18,000. For married couples, the standard deduction will be increased from $13,000 to $24,000. The vast majority of American families will now be able to file their taxes on a single page because they lower taxes by claiming the standard deduction. American families will see their Child Tax Credit doubled to $2,000 per child under age 17. Families will receive a new $500 tax credit for dependents age 17 or older. The full Child Tax Credit will now be availa...

On December 4, the House debated and voted on the motion to go to conference with the Senate on the Republican tax reform bill . A transcript of the debate can be found in the Congressional Record and a video can be found at this link . As mentioned here , Kevin Brady had been named the conference chair by Paul Ryan and he spoke many times throughout the debate. In the process, he offered numerous examples of taxpayers who would get a tax cut from the bill. In fact, each example appeared to follow a Democrat speaker and show a family from their district that would get a tax cut. Following are the examples, taken from the Congressional Record. In addition, each example is preceded by the time that it occurred and can be found in the video . The list under the video allows the user to jump to the exact time desired. 1. (0:50:09) Mr. Speaker, I would point out that a family of four in Michigan’s Ninth District will save over $1,700 each and every year. 2. (0:55:31) Mr. Speaker...