It’s been over a week, and I’m still in disbelief.
Last Tuesday is on the fast track to becoming a chapter in our collective episodic memory. We’ll always remember where we were, who we were with, and whether or not we went to bed before it was called. It’s ingrained in our brains as it’s engrained in our history.
Donald Trump will be our 45th President of the United States of America.
I was considering addressing another topic this week, but I feel I would be remiss, and I feel I would be doing a disservice to my readers if I don’t address this current topic. As business professionals, we need to examine the implications of a Trump presidency on the American economy. What will it mean? Here are some initial theories right out of the gate.
- If Trump cracks down on immigration reform as he promised during his campaign, it would be pretty detrimental to the economy. Emily Stewart from The Street predicts a reduction in the labor force by 11 million workers, a reduction in the GDP by $1.6 trillion, as well as government spending of $400 billion to $600 billion.
- From an accounting standpoint, it’s imperative that we examine his tax plan. Of course, there will be tax cuts for the elite and businesses, supposedly bringing $4-6 trillion back into the economy, but it wouldn’t be enough to sustain a macroeconomy nor would it really distribute the cuts among those who spend.
- Then, there’s the issue of small business. Trump has never really been known to have a propensity for supporting small businesses, but there’s some speculation that his plans may suggest otherwise. He promised to reduce the business tax rate to 15%, and reduce the tax code from seven brackets to three, with nobody paying over 33% in income taxes.
We can only see how these promises pan out, and hope for the best. I’m actually traveling to Stamford, CT this afternoon to attend a Tax Summit sponsored by RSM. I should gain some valuable insights and predictions regarding the tax outlook for 2017, some of which I could perhaps discuss next week.
‘Til then, compadres. Have a great day.