Podcast Summary
Understanding the Economic Policies of Trump and Biden in the 2020 US Election: Examine Trump and Biden's economic policies to make informed decisions and discuss potential outcomes in the 2020 US Election.
The 2020 US federal election carries significant weight due to the country's ongoing health crisis, economic instability, and other pressing issues. Two prominent podcasts, Face Off and NerdWallet's Smart Money, offer insights into the economic policies of the two major candidates, Donald Trump and Joe Biden. While this analysis focuses on economic policies in a vacuum, it's essential to understand that Trump's plans for office, such as sharing the nuclear football with Putin, are not considered in this context. Similarly, Biden's potential policies, like a nationally mandated 3 PM naptime, are also disregarded, as long as they have positive economic implications. The discussion covers the candidates' internal and external economic policies, potential impacts on global markets, and their proposed economic recovery plans. While both candidates have unique approaches, it's crucial to evaluate their economic plans carefully to determine which one aligns best with your interests and values. In conclusion, the 2020 US election represents a significant opportunity for citizens to shape the future of their country's economic landscape. By examining the economic policies of the two major candidates, we can make informed decisions and engage in meaningful discussions about the potential outcomes of each election outcome.
The Complex Process of Creating Fiscal Policy in the US: The creation of fiscal policy in the US is a complex process involving multiple entities, including the president, Congress, Supreme Court, and CBO. Bipartisan cooperation and compromise are essential for effective policy.
The process of creating and implementing fiscal policy in the United States is a complex and lengthy one, involving numerous entities from the president and his or her secretary of the treasury, to the Office of Management and Budget, the Supreme Court, the Congressional Budget Office, and the House and Senate budget committees. The president may write a wish list for fiscal policy, but it must be scrutinized, turned into a bill, and then passed through various entities, each with their own role in the process. The Supreme Court ensures constitutionality, the Congressional Budget Office makes projections, and the budget committees make amendments before the bill is presented to the full Congress for a vote. This intricate process highlights the importance of bipartisan cooperation and the potential for compromise in creating effective fiscal policy.
Complex U.S. budget process with Congress's power: Despite a president's party controlling both houses, the U.S. budget process is a guideline subject to Congress's approval, potentially leading to lengthy negotiations and government shutdowns.
The U.S. budget process is a complex, multi-step process involving various branches of government, and even if a president's party holds majorities in both houses, they don't have complete control over the budget. The budget serves as a guideline rather than a strict rule, and Congress holds the power to approve or deny spending through reconciliation bills. The process can be expedited if the president's party holds majorities in both houses, but if there's a mix of majorities, it can lead to lengthy negotiations and potential government shutdowns. Additionally, the president's ability to influence the budget is limited, as significant economic changes, like alterations to the federal minimum wage, are decided by Congress.
Trump vs Biden: Contrasting Economic Policies: Trump's tax cuts and reduced spending led to economic expansion, but benefits were unevenly distributed, emphasizing the importance of considering distribution in economic policies.
The economic policies of President Trump and Joe Biden represent contrasting ideologies, with Trump advocating for tax cuts and reduced government spending, while Biden supports higher taxes and increased government spending. The Tax Cuts and Jobs Act of 2017, a major success for Trump, resulted in significant expansion of the economy and financial markets, but the benefits were not evenly distributed, with foreign investors receiving a large portion of the rewards while the US bore the full cost. This highlights the potential challenges of relying solely on tax policies to drive economic growth and the importance of considering the distribution of benefits and costs.
Timing of 2017 Republican tax bill had economic consequences: The 2017 Republican tax bill had negative economic consequences due to its timing and disproportionate benefits to high-income earners and corporations. Plans to reverse these tax cuts under President Biden may harm businesses during economic uncertainty and potentially reduce their impact on the economy due to increased flexibility for wealthy households.
The timing of the 2017 Republican tax bill was not economically ideal, leading to potential negative consequences for domestic exporters and contributing to a larger current account deficit. Additionally, the tax bill was criticized for disproportionately benefiting high-income earners and corporations, exacerbating income and wealth inequality. Now, under President Biden, there are plans to reverse some of these tax cuts and increase taxes on high earners and corporations to fund government spending on areas like social security, infrastructure, and healthcare. However, passing these tax increases during a time of economic uncertainty and business struggles due to the coronavirus pandemic may not be the best economic decision, as tax increases are contractionary fiscal policies that could harm businesses already struggling. Furthermore, wealthy households, who will bear the brunt of these tax increases, are now more likely to work remotely, adding to the flexibility of where they can live and potentially reducing the impact of these tax increases on the economy.
Potential High Taxes for High-Income Earners and Effectiveness of Stimulus Packages: High-income earners may face over 60% in combined taxes, potentially causing capital flight and remote work. Effective stimulus packages allocate funds to areas that benefit individuals and the economy long-term, like manufacturing, renewable energy, and education.
The proposed income tax increases could lead to high-income earners paying over 60% in combined state and federal taxes, potentially prompting capital flight and a shift towards remote work. Meanwhile, the importance of government spending during economic crises cannot be overstated, as it acts as a backstop to prevent individuals and institutions from downturns. The effectiveness of stimulus packages, however, depends on how the funds are allocated. The Trump administration's stimulus was the largest in American history but was criticized for favoring corporations, while Biden's Build Back Better campaign aims to invest in manufacturing, renewable energy, caregiving, and education for long-term benefits. Despite the need for another stimulus package, its passing has been delayed in the Senate.
Political reasons for delaying stimulus funding: Delaying stimulus funding until after the election could harm the economy and potentially be used as a political weapon against the incoming administration.
The economic implications of delaying the second round of stimulus funding until after the presidential election could be significant. While there may not be an economic reason to delay the funding, there could be political motivations. If President-elect Biden is in office when the funding is approved, he would be responsible for the increased national debt, which could be used as a political weapon against him in the future. However, delaying the funding could also harm the economy, as the nation needs a boost now rather than in three months. It's important for individuals to be aware of potential political maneuvers and prioritize good economic management during a crisis. The election is expected to be divisive, but economic policy may have the most impact on Americans' day-to-day lives, particularly in regards to stimulus checks. Overall, understanding the potential economic implications of the election outcome is crucial.
