Trump's Reduction of Taxes Only Made The Rich People Richer And The Working Class Poorer

Economic experts debunked the benefits of trickle-down economics far before Trump's tax cuts, but it appears that the President's supporters don't really care.
In 2017, the Republican party introduced a tax law under President Donald Trump's guidance that cut tax rates for some of the wealthiest citizens in the United States. At the time, the legislation was expected to boost the country's economic growth in the upcoming fiscal year and lead to great progress for the American working class through what is known as "trickle-down economics" — the idea that businesses would repatriate funds and ramp up their investments, thereby increasing growth and wages due to lowered tax rates. However, a new study conducted by Congress’s official think tank The Congressional Research Service (CRS) has discovered that the tax cuts did little to no good when it comes to economically elevating those in lower and middle classes, reports Vox. Despite this, no members of the Republican party have reassessed their support for the legislation, which leads citizens to believe that perhaps the financial move was never intended to promote growth for everyone in the nation, but was instead only instituted to line the pockets of the very few in the highest income brackets.
Trump's Reduction of Taxes Only Made The Rich People Richer And The Working Class Poorer

According to CRS researchers, "Although investment grew significantly, the growth patterns for different types of assets do not appear to be consistent with the direction and size of the supply-side incentive effects one would expect from the tax changes. This potential outcome may raise questions about how much longer-run growth will result from the tax revision." This means, effectively, the benefits of the tax cuts were only realized by the wealthiest Americans rather than those it should have aided in the first place.

Unfortunately, the Republican tax law is predicted to prove even more detrimental for income equality in the financial years to come due to the legislation's permanent corporate and wealth-based tax cuts. Among other reductions, the law cut back greatly on tax rates for people making more than $1 million per annum, slashed estate tax on wealthy heirs and heiresses, and even rolled back taxes on pass-through companies disproportionately used by the wealthy.
Trump's Reduction of Taxes Only Made The Rich People Richer And The Working Class Poorer

Due to these elements of the tax law (and others), the most affected group is lower-income families because "almost all of the bill’s gains will accrue to the richest people," as Vox describes. An approximate 83 percent of all the tax cuts in 2027, should the law persist, would go to the top one percent, as estimated by The Tax Policy Center. Other economists also unanimously agreed that the tax legislation would most probably worsen income inequality within the United States, a country that already faces a massive economic inequality problem.

Lily Batchelder, a New York University professor who worked as an economist under President Barack Obama, stated, "The bill is investing heavily in the wealthy and their children — by boosting the value of their stock portfolios, creating new loopholes for them to avoid tax on their labor income and cutting taxes on massive inheritances. At the same time, it leaves low- and middle-income workers with even fewer resources to invest in their children, and increases the number of Americans without health insurance." Ultimately, the Republican tax law exponentially aggravates existing inequality trends within the nation rather than solving the problem at hand. As William Gale, co-director of the Tax Policy Center, affirmed, "It exacerbates preexisting and longstanding trends, rather than aiming to partially compensate for them."
Trump's Reduction of Taxes Only Made The Rich People Richer And The Working Class Poorer