Analysis says tax cut bill would create nearly 1 million new jobs
The non-partisan Tax Foundation has studied the potential effects of the Tax Cuts and Jobs Act introduced in Congress last week. Their verdict? According to their model of how tax cuts work on the American economy, the bill would be a job creating powerhouse:
The Tax Cuts and Jobs Act represents a dramatic overhaul of the U.S. tax code. Our model results indicate that the Tax Cuts and Jobs Act would be pro-growth, boosting long-run GDP by 3.9 percent and increasing the domestic capital stock by 10.6 percent. Wages, long stagnant, would increase by 3.1 percent, while the reform would produce 975,000 new jobs. These economic effects would have a substantial impact on revenues as well, as indicated by the plan’s significantly lower revenue losses under dynamic scoring. On a static basis, the plan would reduce federal revenue by $1.98 trillion over the decade, with some of the revenue loss coming from one-time transitional costs.
The organization has a state-by-state estimate of new jobs created and potential income gains for middle class families as well. That data can be found here.
There is still a valid concern that the bill would reduce federal revenues substantially. The Tax Foundation model suggests greater economic growth would lessen those shortfalls. But the plain fact remains that Congress must find a way to exert fiscal discipline over the budget. So far, they seem both unwilling and uninterested in doing so, leaving us to wonder where all the budget hawks who worried about the debt and deficit have gone.