Some Doubt about the Economic Benefits of GOP Tax Reform

There’s a lot of optimism out there that passage of the Trump tax plan will juice the economy. Many analysts say tax cut optimism is one of the factors that continue to push stocks up, and that has created headwinds for gold and silver. But as we’ve pointed out, there are reasons to question this mainstream narrative.
Now some in the mainstream are even starting to question the mainstream narrative.
There are two major problems with putting hope in GOP tax reform.
In the first place, despite some appearance of progress, it remains questionable whether Congress can pull it together and actually get anything done. Multiple failures to repeal, or even significantly reform, Obamacare didn’t create a lot of confidence in the Republican Congress. There are a number of potential sticking points, including a proposal to eliminate the deductibility of state taxes.
Second, as Peter Schiff pointed out, the plan as presented won’t likely create the economic growth it promises. Why not? Because it’s going to balloon the deficit and that is historically bad for economic growth.

This post was published at Schiffgold on OCTOBER 30, 2017.

 

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