On MSNBC, an economist explains how GOP tax bill benefits real estate investors at the expense of the middle class
Video ››› ››› MEDIA MATTERS STAFF
Loading the player reg...
Loading the player reg...
The extraordinarily unpopular bill is built on lies and ignores what we know about economics
President Donald Trump and his Republican congressional allies are enjoying a round of praise from media commentators for finally getting a legislative “win” on the board as their tax bill closes in on passage before the end of the year. The budget-busting corporate giveaway will enrich the superwealthy and do little for Americans who have to work for a living.
Republicans finally unveiled the finished version of their tax legislation last Friday evening, and -- despite the public having just days to absorb its 1,097 pages -- both chambers of Congress plan to vote on the bill before the end of the week. If everything goes according to plan, the president will sign the bill into law just in time for members to head home for the holidays.
After a year plagued by self-destructive outbursts, failed policy changes, unprecedented legal troubles, embarrassing scandals, humiliating legislative defeats, and nationwide political upheaval, many in the press are framing the GOP tax proposal as a crucial “win” for Trump and his party.
On the December 18 edition of CNN Newsroom, co-host Poppy Harlow wondered how anyone could argue the past year “hasn’t been a win for the president on some big fronts,” given a handful of recent accomplishments, including the new tax bill. Reporter Caitlin Huey-Burns agreed with Harlow’s assessment while noting that such favorable framing fits “the way that the White House has been messaging their own achievements”:
During an earlier segment on CNN’s New Day, guest A.B. Stoddard suggested that the Republican tax bill, which the Economic Policy Institute has labeled “a scam,” could count as “a great boon for Republicans” and “a win on the board,” if the bill actually fulfilled its over the top promises. (It won’t.) Commentary framing the expected party-line vote as a major victory for the GOP also cropped up in The Associated Press, Politico, The Hill, and The New York Times. Reporters have seemingly gone out of their way to pat Republicans on the back for endorsing legislation so historically unpopular it registers significantly less support than some previous tax hikes:
In a December 15 video, Eric Schoenberg of the activist group Patriotic Millionaires explained how the GOP tax bill overwhelming favors wealthy people like him (and the Trump family) while doing little for lower- and middle-class people. Trump and the Republicans continue falsely claiming that the bill will spur business development, boost wages, and stoke renewed economic growth, but the message is such a fantasy even Fox News had to admit there was nothing to it. Previous studies from the Congressional Research Service and the Brookings Institution have demonstrated little relationship between tax cuts for the wealthy and invigorated economic activity, which Trump and the GOP have promised will result from this tax bill.
The bill permanently cuts taxes for corporations while giving only modest, temporary relief for working people. It loosens tax structures affecting the wealthiest Americans while threatening funds for Medicare, Social Security, Medicaid, and other initiatives that guarantee basic economic security to low-income families. The bill promises to add another $1.5 trillion to federal budget deficits over the next decade despite years of hysteria about Obama-era revenue shortfalls. The bill also senselessly repeals the Affordable Care Act’s individual mandate, which will likely result in millions of Americans dropping out of the insurance market.
Rather than praising the Republican Party for ending a remarkably unproductive year by managing to cobble together a tax giveaway to the super rich, journalists should report on what is actually in the bill. Trump and the GOP have definitely enjoyed some "wins" this year, but reporters need to point out that the Republican Party's successes have often resulted in pain and suffering for millions of Americans.
This is exactly how journalists need to treat the Republicans’ messaging nonsense on their giveaway to the rich
MSNBC hosts Ali Velshi and Stephanie Ruhle thoroughly debunked conservative talking points about the Republican Party’s pro-corporate tax policy during an interview with an ill-prepared member of Congress, who was attempting to build support for his party’s proposed tax changes that overwhelmingly favor the wealthy.
During the December 4 edition of MSNBC Live with Velshi and Ruhle, Velshi presented a detailed outline of the many ways in which Republican tax bills in the House and Senate will fall short of GOP promises and commitments. Velshi noted that numerous independent analyses have shown the GOP plans will add upwards of $1 trillion to the national debt, and pointed out that despite “huge changes made to our tax code … we’ve seen no observable shift to long-term growth rates in the last 150 years.” Velshi also pointed to a survey conducted by the University of Chicago’s Booth School of Business, which found that none of the 42 leading economists surveyed believe the plans will be able to boost economic growth rates by enough to make up for lost revenue. He concluded the segment by pointing to a recently-released Goldman Sachs analysis of the Senate tax bill, which concluded that economic growth stemming from the tax bill will be lower than Republicans have claimed, and, as Velshi stated, “possibly even … negative” after a few years:
Immediately after outlining all the problems in the GOP tax plans, MSNBC invited Rep. Chris Stewart (R-UT) on the program and gave him an opportunity to defend his party’s policy priorities. Stewart’s performance did not go as he might have anticipated, with co-hosts Velshi and Ruhle taking turns debunking GOP talking points and pillorying Stewart’s excuses for the tax plan.
The co-hosts rebuffed Stewart’s repeated assertions that tax cuts for profitable corporations and wealthy individuals will boost economic growth (a 2012 Congressional Research Service study found no correlation between income tax rates and economic growth, and a 2014 study from the Brookings Institution argued the relationship between tax cuts and growth was “theoretically uncertain”), they corrected his false claim that the United States has the world’s highest corporate taxes (effective corporate rates are the same as other developed countries), and they called out his false claim that “the American people want us to do this” (the GOP tax plans are actually extremely unpopular). When Stewart claimed the GOP plans are effective in simplifying the tax code, Ruhle challenged him over and over to name a single corporate loophole that is being removed (he couldn’t), and both co-hosts stung Stewart over how Republican plans fail to address the so-called “carried interest” loophole, which helps extremely high-income individuals avoid paying taxes on some of their income.
By the end of his nearly 11-minute grilling, Stewart was actually defending the discredited theory of “trickle-down economics” by name, which Velshi correctly noted was such a disaster in Kansas that the state’s Republican-dominated legislature had to abandon their conservative tax agenda.
This takedown from Velshi and Ruhle is not the first time the MSNBC duo has discredited the GOP’s hollow economic message. Both Velshi and Ruhle have spent considerable time over the past several months pointing out that the Republican agenda favors wealthy individuals, profitable corporations, and the Trump family at the expense of lower- and middle-income Americans. This important work in correcting purposeful misinformation about the GOP's right-wing agenda is all the more important as Republican lawmakers prepare to enact tax policy changes that could affect millions of Americans for years to come.
Loading the player reg...
Loading the player reg...
Loading the player reg...
Loading the player reg...
Stuart Varney: Ignore Trump’s political failures, praise “MAGAnomics”
Fox Business host Stuart Varney celebrated the first six months of the Trump administration by ridiculously claiming that the election and inauguration of President Donald Trump are responsible for adding trillions of dollars to the economy and lifting wages for low-income workers around the country. Varney’s claims are the latest in a long-running right-wing media fantasy that the Republican Party’s economic agenda will unleash the American economy, which conveniently ignores more than six years of steady economic progress under the Obama administration.
On July 20, Trump celebrated the six-month anniversary of his inauguration as president of the United States. By any objective measure, Trump’s presidency has already been one of the strangest and most chaotic in living memory. The Trump administration is consumed by scandals of its own making, and, according to a Washington Post report published on Trump’s six-month anniversary, the president is beginning to ask his political and legal advisers “about his power to pardon aides, family members and even himself.”
Despite these facts, the team at Fox News and Fox Business attempted to find a silver lining for the Trump presidency by falsely crediting his administration for the continued overall health of the American economy. In a July 20 op-ed published by FoxNews.com and a corresponding segment on Varney & Co., host Stuart Varney credited Trump with “add[ing] $4.1 trillion to the nation’s wealth” thanks to a post-election stock market rally. Varney also preposterously claimed that “during [Trump’s] presidency,” long-established American tech giants “Apple, Amazon, Alphabet, Microsoft and Facebook” have “emerged as global technology leaders.” Varney’s ridiculous claims were promoted by the network’s social media accounts and parroted again from the Trump-friendly confines of Fox & Friends during a segment in which Varney also credited Trump for wage growth witnessed by low-income workers. From the July 21 segment:
Fox’s claim that Trump is responsible for low-income wage increases stems from a July 20 Wall Street Journal article, which said that “full-time earners at the lowest 10th percentile of the wage scale” witnessed a 3.4 percent year-to-year wage increase in the second quarter of 2017, according to data from the Department of Labor. Contrary to Fox’s argument that Trump deserves credit for the increase, the Journal pointed to consistently low unemployment rates and minimum wage increases enacted by states and municipalities across the country as primary drivers of the uptick, which continued an accelerating wage trend for low-wage workers dating back to 2015. Minimum wage increases have been found to correlate with significant gains to low-income earnings, as the Massachusetts Budget and Policy Center (MassBudget) reported on September 5, and 19 states increased their minimum wages at the beginning of the year:
In addition to falsely crediting Trump for years-long wage growth trends, the team at Fox News also claimed that Trump is responsible for a $4.1 trillion increase in stock market capitalization since Election Day, citing the Wilshire 5000 composite index. It is true that American stock markets have gained value since November, but as CNN business correspondent Christine Romans pointed out last month, stocks had been gaining value for years before Trump’s election. Indeed, the Wilshire 5000 index, like other major stock indices, has been consistently climbing since bottoming out in March 2009 in the midst of the Great Recession and financial crisis.
Fox’s promotion of Trump’s supposed economic success was not lost on the network’s number one fan, as the president posted a video of Varney’s celebratory July 20 segment on Twitter just this morning:
— Donald J. Trump (@realDonaldTrump) July 21, 2017
Fox has repeatedly pushed misleading economic data to hype Trump since the start of his administration, and the network has even fought against increased minimum wages, which are partly responsible for the wage growth its hosts now celebrate. Fox’s sycophantic devotion to Trump runs so deep that Varney even once admitted his unwillingness to criticize the president, a complete reversal from the tone of his coverage during the Obama administration.
The White House’s rollout of its so-called “infrastructure week” agenda demonstrated once again that President Donald Trump and his staff are interested in policy discussions only insofar as they can generate short-term media narratives. The infrastructure scheme that the Trump team is pushing falls far short of the substantive approach necessary to address America's infrastructure needs and stands in stark contrast to plans outlined by progressive advocates. The Trump plan seems designed to curry headlines rather than spur a serious media conversation about infrastructure.
On June 5, the White House released a vague six-page infrastructure outline touting the Trump administration’s goal to invest “at least $1 trillion in total infrastructure spending” over the next decade along with numerous other initiatives. A close reading of the plan, coupled with the White House’s budget request for the 2018 fiscal year, shows that it is not actually a plan to invest $1 trillion in our nation’s roads, bridges, and other vital infrastructure. Instead, it is a proposed $200 billion tax giveaway to developers and construction contractors, which the administration hopes would spur additional private sector investment of up to $1 trillion.
Aside from a controversial side project that would break up and privatize the Federal Aviation Administration’s (FAA) air traffic control systems, which has encountered pushback from both the head of the FAA and from Trump’s own transportation secretary, the Trump infrastructure agenda included few specific policies. Most major media outlets saw the “infrastructure week” gambit for what it was, a transparent attempt to distract media attention away from the looming congressional testimony of former FBI Director James Comey.
This isn’t the first time the Trump administration has hastily rolled out an incomplete economic agenda in hopes of distracting the press from the challenges it’s facing. In late April, as the administration neared its 100th day in office with no major legislative accomplishments, the White House rolled out a comically incomplete one-page tax plan that was pilloried in the press. The plan called for “a radical reordering” of tax policy that The New York Times projected “would significantly benefit the wealthy.” The hastily drafted tax plan was described as “a frantic last push” for a policy victory after what media observers had dubbed “100 days of failure.”
By all accounts, the White House’s head fake on infrastructure failed, in part because the president couldn’t keep himself on message. But the attempt to again use vitally important domestic policy debates as a ploy to manipulate media attention underlines a telling problem with the Trump White House. The administration’s approach to economic policy seems to be little more than a media game -- a shame given the extent of necessary investments and reforms needed nationwide.
According to the American Society of Civil Engineers (ASCE), the United States faces a $2 trillion spending shortfall over the next decade to make necessary upgrades to its D+ rated infrastructure. The Congressional Progressive Caucus (CPC) has a plan to make precisely those investments, and another plan floated earlier this year by Senate Democrats would bridge at least part of the funding gap. By comparison, the White House’s contribution to this substantive infrastructure debate is a flimsy and exaggerated series of tax cuts and controversial public-private partnerships that bear a closer resemblance to trickle-down economics than to infrastructure policy.
The “infrastructure week” gimmick failed to create the headlines the administration wanted, and the White House has reportedly put little effort into turning its agenda into viable legislation. Millions of Americans stand to benefit from actual investments in public infrastructure, and those millions of people deserve more from the White House than fleeting attempts to gin up good press.
Don’t be fooled: Trump’s “$1 trillion” infrastructure agenda is actually just a $200 billion tax giveaway
President Donald Trump is back on the campaign trail today promoting his infrastructure agenda, which the White House has falsely labeled as a $1 trillion plan to stimulate the economy and upgrade American infrastructure. Media outlets should avoid accepting the administration’s characterization of its scheme, which falls short of its already inadequate price tag and would saddle Americans with additional tolls and user fees.
On June 7, Trump is scheduled to appear at a rally in Cincinnati, OH, where he will promote his plan for American public infrastructure. The White House has billed its infrastructure agenda as a $1 trillion plan to upgrade and revitalize failing public works around the country. But, as The Associated Press (AP) and CNN reported, the plan outlined in Trump’s budget request for fiscal year 2018 just called for $200 billion in tax cuts spread over nine years meant to “leverage $1 trillion worth of construction.” The plan would establish a nationwide system of so-called “public-private partnerships” -- sometimes referred to as P3s -- that could impose new cost burdens on taxpayers. An article in The New York Times outlined how P3s “may result in near-term savings” but “there is little hard evidence that they perform better over time.” Eventually, taxpayers end up paying for infrastructure via taxes or tolls whether it is controlled by the government or leased to a private for-profit firm. A June 7 column in Politico went into even more details of the potential pitfalls of Trump’s pursuit of a public-private partnership model:
The government can reap huge benefits from public-private partnerships—but only if they are structured correctly. All too often, though, government officials lack the knowledge and experience necessary to negotiate good deals, ultimately costing taxpayers millions, if not billions, of dollars. In their attacks, Democrats may be misusing the word “privatization” when describing Trump’s infrastructure plan but the risks they describe are very real.
Other than the pitfalls of public-private partnerships inherent to Trump’s plan, it is also woefully inadequate to address the needs of public infrastructure in the 21st century. According to the American Society of Civil Engineers (ASCE), public infrastructure in the United States earned a D+ grade in 2017 and is in need of over $2 trillion of new investments over the next decade. Even in the best-case scenario, Trump’s plan would fall far short of these necessary investments -- and as some Democratic lawmakers have pointed out, Trump is actually cutting more from existing infrastructure programs than he plans to spend on tax cuts for new infrastructure. In contrast to Trump, the Congressional Progressive Caucus (CPC) does have a plan to make up for the roughly $2 trillion infrastructure funding gap, which it believes would create millions of new jobs and meet America’s infrastructure needs. The CPC proposal released last month stresses the need to “prioritize public investment over corporate giveaways” while addressing the need to “prioritize racial and gender equity and environmental justice” while stoking economic growth.
Far from being a $1 trillion plan to inject desperately needed federal investments into ailing public works, the Trump plan is little more than trickle-down economics loaded with tax giveaways for business and it is inadequate at best. Media coverage of his proposal needs to reflect those facts and would benefit from including expert perspectives and opposing views to better inform the infrastructure debate.
News outlets, experts, and health care advocates blasted President Donald Trump’s federal budget proposal that would rip health care away from millions while eliminating key HIV prevention and research programs. If enacted, these cuts would have a disproportionately devastating impact on members of the LGBTQ community, who rely more heavily on Medicaid than the general public does and face higher rates of HIV infection.
Outcries continue to grow in response to Trump’s federal budget proposal for the 2018 fiscal year. The proposal faced immediate criticism for its unrealistic revenue projections and was branded by critics as a “repugnant grab bag” of cuts to vital anti-poverty and public health programs to pay for part of a massive tax cut for top earners. The latest criticism of Trump’s budget comes from public health experts and LGBTQ media, which are pointing out that its cuts to Medicaid, coupled with harsh reductions in funding of HIV treatment, prevention, and research add up to a reprehensible swipe at the LGBTQ community.
Cuts to Medicaid would disproportionately affect the LGBTQ community, which faces higher levels of poverty than the public at large. On May 28, NBC Out reported that Trump’s budget would hit the LGBTQ community in several ways. Stephen Forssell, director of George Washington University’s graduate program in LGBTQ health policy, explained that Medicaid is “hugely important” for LGBTQ Americans, who are more likely than others to rely on the program:
Medicaid is "hugely important" for the LGBTQ community," (sic) Gruberg told NBC Out, noting that 18 percent of lesbian, gay, bisexual and transgender people have Medicaid compared to 8 percent of non-LGBTQ people.
Gruberg also noted that Medicaid is the "largest source of coverage for people with HIV in the U.S.," adding that "a $1.4 trillion cut to Medicaid over 10 years will be detrimental to the ability of people living with HIV to get the health care they need to survive."
HIV funding is of great concern for the LGBTQ community and faces steep cuts in the White House’s budget. The Health Resources and Services Administration (HRSA) outlined that the fiscal year 2018 budget would include a $59 million reduction to the Ryan White HIV/AIDS program, including eliminating all its funding for LGBTQ and minority education and HIV prevention. The Ryan White HIV/AIDS program funds health care services for individuals living with HIV as well as public service education programs about the virus. The program is named after an HIV activist who fought for the program’s enactment before tragically passing away just months before it was authorized after battling the virus.
On May 31, the Washington Blade highlighted the funding cuts to the Ryan White HIV/AIDS program and an additional $186 million in proposed cuts to the Center for Disease Control and Prevention’s (CDC) work on HIV and other sexually transmitted infections (STIs). Doug Wirth, CEO of the nonprofit Amida Care, called Trump’s budget proposal a “cruel and callous attack” on those living with HIV. Advocacy groups argued that the funding cuts would lead to “more suffering” for those living with HIV, and the AIDS Institute criticized the White House’s “severe cuts” while noting that the 19 percent cut to the CDC’s HIV prevention program would set back efforts to eliminate the virus.
According to the Kaiser Family Foundation, gay and bisexual men represent 2 percent of the American population but make up 56 percent of all Americans living with HIV and 55 percent of all HIV-related deaths in the U.S. The CDC reported that while HIV diagnoses have declined overall in recent years, diagnoses have increased among gay and bisexual men. The CDC found that much of the increase was among men of color and even projected that one out of every two black gay and bisexual men would become infected with the virus during their lives. Currently, gay and bisexual men make up 67 percent of all new HIV infections:
Trump’s cuts to HIV programs are eerily reminiscent of cuts Vice President Mike Pence imposed on Indiana during his tenure as governor. Pence followed through on right-wing media’s obsession with defunding Planned Parenthood and cut funding to the health care provider ostensibly to reduce abortions, but in doing so actually shut down access to the only HIV testing centers available to many Indiana residents and may have inadvertently caused an HIV epidemic in rural parts of the state. Pence has a long history of supporting right-wing media causes against the LGBTQ community and during the 2016 presidential campaign was called out by MSNBC host Rachel Maddow for statements he made while serving in Congress.
Trump campaigned as an alleged ally of the LGBTQ community, but community leaders recently slammed his “shameful” refusal to sign a proclamation declaring June LGBTQ Pride month, ending an eight-year tradition. The Trump administration also faced pushback after it announced it would not allow Americans to self-identify as LGBTQ in the 2020 national census.
Fox News used the Bureau of Labor Statistics’ (BLS) underwhelming jobs report for the month of May as proof that Congress needs to pass President Donald Trump’s trickle-down economic agenda that, in reality, would strip working- and middle-class Americans of basic public services and hand top income earners a gigantic tax cut.
On June 2, BLS released its jobs report for May 2017, which estimated the United States added 138,000 new jobs last month while the unemployment rate fell slightly to 4.3 percent. The jobs number fell below economists’ expectations and The Washington Post declared that the report showed that the “job market stumble[d]” last month. While the number of new jobs reported was weaker than expected, The New York Times noted the overall health of the economy was still strong enough for the Federal Reserve to possibly raise interest rates and pointed out that wage growth was up 2.5 percent from this time last year.
In response to this news, Fox pushed the absurd claim that the report is proof that big business needs Congress to pass Trump’s economic agenda of tax cuts and gutting consumer protections to stoke further economic growth and job creation. During the June 2 edition of Fox News’ Fox & Friends, guest Steve Hilton, host of The Next Revolution, used the jobs report to claim the U.S. was in a “jobs crisis” and needed Trump’s economic agenda to be enacted. On Fox Business’ Varney & Co., host Stuart Varney described the jobs number as “lousy” and “disappointing” while correspondent Ashley Webster claimed the jobs number shows the American economy is “in a holding patterning” that is “waiting on Washington” to act. Fellow Fox Business host Maria Bartiromo added that “what this jobs number tells us is that business is still cautious” and companies are “sitting on cash” because they are “strangled by all of the regulatory environment” and waiting for Congress to pass Trump’s agenda:
In reality, Trump’s economic agenda has been described as a “repugnant grab bag” of tax cuts for top-income earners that guts funds for Medicaid, children’s health insurance, food assistance, medical research, disease prevention funding, disability insurance, and even college student financial aid while watering down consumer protections to give Wall Street investors a $100 billion windfall. Trump’s budget proposal to slash funding for vital health assistance programs has been described as “ruthless” and would exact a huge human cost from those who lose access to care.
Far from being a jobs savior, Trump’s economic agenda has faced heavy criticism from economists for relying on “voodoo” economic theories that falsely claim tax cuts will lead to economic growth. Research from the nonpartisan Congressional Research Service and Brookings Institution have found no link between tax cuts and economic growth. Economist Jason Furman has also slammed Trump’s tax cut agenda for proposing to add trillions of dollars to the federal debt in ways that could hamper economic growth. Trump’s tax proposals have been blasted by economists and experts across the political spectrum, who have argued that his restrictive approach to international trade and immigration, if enacted, may actually dampen economic activity. Even Trump’s proposals to reduce supposedly burdensome regulations in the financial industry fly in the face of facts -- Trump has proposed dismantling the Dodd-Frank Act, but the Government Accountability Office concluded in 2016 that Dodd-Frank protections have “contributed to the overall growth and stability in the U.S. economy.”
Fox figures have attempted to use the monthly jobs report to advance the president’s agenda since he first took office. Fox used the reports to claim unearned victories for the president, and even once used a jobs report described as “weak” to declare it was “the most successful day” of Trump’s presidency. Last month, a Fox Business panel attempted to spin the April jobs report as a reason to pursue Trump’s tax and regulatory policies with no evidence to back up its claims. Next month will likely produce more of the same.
White House budget proposal bases its revenue numbers on unrealistically high economic growth projections
Experts and journalists have pointed out that President Donald Trump’s budget numbers for the 2018 fiscal year do not add up, as they rely on unrealistic growth expectations. Nonpartisan experts say the gap between the White House’s estimates and the Congressional Budget Office’s is “the largest on record.”
On May 23, the White House released its full budget proposal, which not only calls for kicking millions of working- and middle-class Americans off vital public assistance programs to make room for gigantic tax cuts for top income earners, but also bases its tax revenue projections on expected annual gross domestic product (GDP) growth of 3 percent by 2020. While right-wing media commentators have repeatedly defended trickle-down economic fantasies that predict unlikely levels of economic growth because of tax cuts for the rich, assuming such growth when determining revenue projections for the federal budget hides the true cost of Trump’s devastating budget plans.
Experts and journalists quickly noted the absurdity of Trump’s projections in their coverage of the budget request. In a Washington Post blog, former Treasury Secretary Larry Summers, an economist at Harvard University, called the logic of Trump’s growth assumptions “simply ludicrous” and compared it to believing in the tooth fairy. On the May 23 edition of MSNBC Live, economist Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities (CBPP), told host Ali Velshi that Trump’s budget “does not add up at all” while noting that economic growth “is a function of the growth of the labor supply,” and that’s going to slow as the country grows older. Bernstein compared the chances of Trump’s projections coming true to the chances of a kitchen appliance coming to life to sing and dance, concluding that it is reckless for budget numbers to be “based on on these kinds of fairy tales”:
On May 23, Vox correspondent Matt Yglesias pointed out that for anyone over 35, annual growth of 3 percent “doesn’t sound outlandish” because it is reminiscent of GDP growth during the 1990s. But Yglesias noted that if the United States did manage today to replicate 1990s-level growth in the labor force, productivity, and capital investment, “even under that rosy scenario” the growth rate would not hit 3 percent:
In a May 24 column for Vox, economist and former Obama adviser Jason Furman explained in even more detail why 3 percent economic growth was “extremely unlikely,” with a specific focus on the slowing growth of the labor force. Furman also noted that the American economy is already growing faster than other advanced economies around the world, which have struggled to keep pace.
As FiveThirtyEight’s Ben Casselman explained, the reason this level of growth is not currently attainable is that during the 1990s, the U.S. saw “rapid growth in its labor force and rapid gains in the productivity of that labor force.” By comparison, the baby boom generation today is retiring, not entering the workforce, which slows labor force growth, and “growth in productivity has slowed to a crawl” as electronic and internet-based technologies from the 1990s have matured.
On May 24, The Washington Post’s Ana Swanson also looked at how realistic Trump’s growth projections would be with regard to labor force growth after Mick Mulvaney, director of the Office of Management and Budget, told reporters that much of the growth could come from getting the 6 million Americans marginally attached to the workforce to be fully employed. Yet, as Swanson noted, adding 6 million workers to the 160 million Americans already in the labor force would generate only 2 percent growth.
Trump’s budget projections were not just debunked for lacking numbers based in reality; CBPP pointed out the historic gap between the White House’s economic growth projections and those of the nonpartisan Congressional Budget Office (CBO). According to a May 22 CBPP blog post, Trump’s budget proposal projects $3 trillion less in deficit accumulation using its 3 percent growth model than it would using the CBO’s less optimistic economic forecasting. The difference is even more striking because, as CBPP pointed out, the gap between the White House’s proposal and CBO forecasting is “the largest on record”:
On May 23, President Donald Trump released his vision for the fiscal year 2018 federal budget titled, “A New Foundation for American Greatness,” which called for deep cuts to Medicaid, Social Security Disability Insurance (SSDI), student loan assistance, and anti-poverty programs geared toward working- and middle-class Americans while providing gargantuan tax cuts for top income earners and increasing military spending. As details of the budget began to surface in the lead up to the announcement, Media Matters identified some of the best take downs from journalists and experts hammering the proposal for its “ruthless” cuts.
Budget proposal will include deep cuts to Medicaid and Social Security, programs Trump promised to protect during campaign
Multiple news outlets have reported on the harsh human toll of President Donald Trump’s budget proposal, which is expected to gut programs that guarantee basic living standards, including parts of Medicaid and Social Security. These cuts directly contradict Trump’s promise to save the programs “without cuts.”
The White House first hinted at slashing programs that help working- and middle-class Americans on February 26 when, according to Bloomberg, Trump floated proposals to increase defense spending by 10 percent while cutting programs including assistance for low-income Americans while still promising not to touch Medicare, Medicaid, and Social Security. The White House claimed these drastic cuts would help spur economic growth, an absurd claim that was resoundingly ridiculed by economists as “deep voodoo” and “wholly unrealistic.” The administration’s initial budgetary proposals were so drastic and poorly thought out that they stunned many observers and experts. The White House even advocated cutting assistance to the Corporation for Public Broadcasting, which would be particularly harmful to “small-town America,” and Meals on Wheels, which “doesn’t make economic sense” and would cruelly deny millions of elderly Americans basic companionship and a hot meal.
On May 21, The Washington Post reported that the White House will unveil a formal federal budget proposal that goes even further than the administration’s earlier indications by proposing “massive cuts to Medicaid” and other anti-poverty public assistance programs. On May 22, Axios reported that the president plans to cut $1.7 trillion over 10 years from federal assistance programs including the Supplemental Nutrition Assistance Program (SNAP), the Children’s Health Insurance Program (CHIP), and Social Security Disability Insurance (SSDI), which collectively serve tens of millions of people. (Axios incorrectly stated that Trump’s budget plan “won’t reform Social Security or Medicare,” before outlining Trump’s plan to cut SSDI and incorporate massive Medicaid restrictions that would become law if his Obamacare repeal plan is ever enacted.)
As details of Trump’s budget plan continued to leak, some media outlets explained the devastating consequences for millions of Americans if the White House gets its way and these drastic cuts take effect. They also explained that Trump’s embrace of deep cuts to components of Medicaid and Social Security represent a betrayal of his promises from the campaign.
CNN chief business correspondent Christine Romans explained on the May 22 edition of CNN Newsroom that much of the money being cut from mandatory spending would come from Medicaid, which could see up to a 25 percent reduction in federal funding, pushing the financial burden onto the states and kicking 14 million people off their health insurance programs. Romans mentioned that protecting Medicaid is one of many campaign promises from Trump “that are turning out not to be true.”
On the May 22 edition of MSNBC Live, host Chris Jansing went even further in breaking down the human toll of Trump’s budget cuts with NBC News senior editor Beth Fouhy and New York Times national reporter Yamiche Alcindor. The show aired part of an interview with a mother of two young children, who told Fouhy that if these cuts are enacted, the costs of care for her child with cerebral palsy will bankrupt her. Then they showed a clip of Trump on the campaign trail proclaiming that he would “save Medicare, Medicaid, and Social Security without cuts.” Alcindor discussed a report she wrote for the Times earlier this month about the human costs of budget cuts that would lead eliminate programs that help provide small communities with access to clean drinking water, drug rehabilitation centers, and jobs programs: