Remember when everyone wanted to cut the federal deficit? Fiscal policy was much simpler back then: balanced budget good, deficits bad.
Times change. Now the House and Senate are considering tax legislation that, according to their own numbers, will add $1.5 trillion to annual deficits over the next 10 years.
This is okay, we’re told, because the tax cuts will stoke economic growth, thereby delivering added tax revenue that offsets the rate reductions.
Note the bigger point here. Republicans still say they don’t like deficits – but apparently, this particular plan lets them cut taxes without adding more debt. It’s a miracle.
Is their claim really true? Will the GOP tax plans boost economic growth?
That’s the 1.5-trillion-dollar question.
This post was published at Mauldin Economics on NOVEMBER 21, 2017.