The U.S. economy continues to sputter along. The latest check on consumer spending showed Americans did little of it in December. This follows fourth-quarter gross domestic product data which failed to break even one percent, registering just 0.7 percent.
Could the slate of presidential candidates do much better? The Tax Foundation took a detailed look at the impacts of tax plans of the candidates to determine just that.
When it comes to overall economic growth over the next 10 years, Senator Ted Cruz beats the bunch with his policies contributing to an additional 13.9 percent growth over and above what government projects for the economy during those years. In other words, in each of the next 10 years, his tax policies would add another 1.39 percent worth of growth each year. Donald Trump’s tax plan would add an additional 11.5 percent growth over the decade or 1.15 percent growth each year. Senator Bernie Sanders is the worst performer because his tax plan would push down growth by 9.5 percent over the decade, while Hillary Clinton’s plan is pretty much a wash, pushing down growth by 1 percent over the 10 years.
Keep in mind that critics say plans like Trump’s would fail to fund anything other than the big entitlement programs. Under Trump, defense programs, for example, would go begging. The Tax Foundation analysis shows Trump’s plan reducing government revenues by nearly $12 trillion over ten years, the most of any candidate.
If it’s job growth you’re interested in, Trump’s is the biggest winner. His tax plan would grow jobs by 5.3 million over 10 years. The worst? Sanders, whose tax plan would cut jobs by 5.9 million.
Wage growth, another critical metric for Americans because we’ve had so little of it, is highest under the Cruz plan, growth rates in wages would jump 12.2 percent. And, workers would definitely feel the burn under Sanders, whose plans would cut wage growth rates by 4.3 percent. Trump’s wage rate growth would be half of that of Cruz, at 6.5 percent. Clinton’s plan does little to move the needle in any direction when it comes to wage growth or job growth.
One big takeaway from the Tax Foundation analysis is this: It takes massive change to move the economy significantly with tax policy alone. The American economy is massive, still the biggest in the world, and encouraging it to expand is tough work for legislators.