Donald Trump's economic plan only benefits the wealthy
Donald Trump's plans will deepen economic inequality across the US. His policy agenda includes a number of superficial improvements that will inevitably lead to a widening wealth gap between the top and bottom of American society.
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As president, Trump has introduced tax cuts for corporations and the upper class, and has planned significant cuts to Medicaid and Medicare outlined in the 2021 budget proposal. Bernie Sanders argues that 83% of the benefits of Trump’s tax cut agenda will go to the top 1% and that CEOs now earn over 360 times more than their average workers. If true, reports that Trump only paid $750 in federal income tax in 2016 and 2017 highlight the current president’s view of taxation as a redistribution mechanism. Biden, if elected, will raise the top bands of corporate tax from 21% to 28% and income tax from 37% to 39.6%. This change would see 93% percent of the tax burden fall on the top 20% of earners, whilst 75% would be covered by the wealthiest 1%. Biden also wants to raise the federal minimum wage to $15 an hour and forgive student debt for low-income graduates. These plans would enable a significant redistribution of wealth, reversing the trend under Trump and promoting better economic outcomes for working and middle class individuals.
Trump’s pro-business and pro-American agenda has seen the median household income rise and the poverty level fall, and to a greater extent in black and Hispanic communities. His economic policies also contributed to significant job growth before the coronavirus pandemic; for more on this refer to the argument ‘Donald Trump has increased income levels across all economic groups’. Biden’s redistribution priorities also represent a threat to US businesses, who may struggle to compete on the international market if the minimum wage is raised to $15 an hour. Tax raises on the wealthiest may also incentivise them to move their assets or operations abroad where tax regimes are more favourable, which would in turn negatively impact the wider US economy.
Wealth redistribution and public service provision are important for securing the basic needs of all, enabling greater economic productivity across the whole of society.