Economists discuss their projections and economic policy outlooks under a Trump presidency
Economists Robert Wolf and Steve Moore provide economic analysis under a second Trump administration on 'America Reports.'
Democrats have no equals when it comes to taking undeserved credit and evading well-deserved blame. Consider a recent Time article titled "Don’t Give Trump Credit for the success of the Biden Economy." Of course, no one, including President-elect Trump, wants credit for Biden’s dumpster fire economy. That debacle just cost the Democrats an election.
So, what is Time’s piece all about? Well, it is part of an effort to position Democrats to take credit for what even they see as Trump’s coming economic turnaround.
It’s not the first time Democrats have tried to take credit for Trump’s economic success.
President-elect Trump arrives to speak during an election night event on Nov. 6, 2024, in West Palm Beach, Florida. (Chip Somodevilla/Getty Images)
Recall that in 2017, Trump inherited a stagnant economy mired in big government muck. He immediately cut taxes, slashed regulations and encouraged domestic energy production. Freed from eight years of President Obama’s oppressive policies, business optimism soared and the economy boomed.
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In three years, America’s economy went from stagnating to thriving precisely because Trump reversed virtually every one of Obama’s stifling big government policies and adopted energizing free market policies. Obama nonetheless attempted to claim credit for that success.
NBC News, among other legacy media sources, predictably ran a piece supporting this notion claiming that "Trump didn’t build a great economy he inherited it."
So, here we go again.
Let’s consider where the economy really is – and why.
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The elephant in the room is, of course, our record high federal debt and deficit. While both have been increasing for decades, pandemic spending put those negative trends on steroids.
In the beginning, that spending was bipartisan.
Republicans saw the pandemic as a national crisis requiring a federal response. Once the crisis was averted, they believed the country would reduce and address the consequences of that spending, as it had done following other serious crises, such as World War II. They did not anticipate continued spending at crisis levels once the crisis ended.
Unfortunately, in 2021, the Democrats took control of the presidency, the House and the Senate. They viewed the pandemic as an opportunity to advance progressive social and political goals. So, they needlessly spent additional trillions of dollars.
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As a result, four years later, Biden is handing over an economy encumbered by an astounding record high debt of over $36 trillion and a record high annual deficit of $1.8 trillion. And the damage isn’t done. Recently, in just over the last 100 days, the federal debt soared an additional $1 trillion.
There are consequences for that kind of fiscal irresponsibility and both working- and middle-class Americans are suffering those consequences.
With inflation up over 20% since Biden took office, real wages (wages minus inflation) have declined 2.2%. Because real wages are what people live on, consumers are stretched to their economic limits.
Adjusted for inflation, retail sales over the past three year have flatlined. Household debt has reached a record high of nearly $18 trillion. Mortgages, car loans and credit card debt are all at record highs. Credit card and car loan delinquency rates as well as corporate bankruptcies are at their highest levels since the Great Recession. That’s the "success of the Biden economy."
Perhaps most damning, Biden has no plan in place to alleviate this economic pain. As is often the case with Democrats, their one proposal is to increase taxes while they continue spending like drunken sailors – an insult to drunken sailors who at least spend their own money.
Contrary to what you will hear from the Democrats, if you want to increase tax revenue, don’t increase tax rates. Meaningfully increasing tax rates reduces economic growth which reduces tax revenue.
For example, under the current Trump tax cuts, tax revenue hit historic highs of over $4 trillion in each year of the Biden administration. In 2022 and 2024, tax revenue was just under a gobsmacking $5 trillion. None of the naysayers predicted this revenue boom.
The problem is that in 2024 the government spent $6.75 trillion.
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Obviously, we don’t have a revenue problem, we have a spending problem. We need to meaningfully reduce spending while we simultaneously increase tax revenue through economic growth.
To accomplish those goals, Trump will undo Biden’s economic policies as he did Obama’s.
To continue increasing tax revenue, Trump will keep the current low rates in place and selectively reduce rates to further encourage economic growth. This worked for Presidents Kennedy, Reagan and Trump (in his first term). It’s the plan for his second term, and it will work – again.
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Trump will free America’s economy from Biden’s regulatory nightmare to encourage economic growth and domestic energy production, meaningfully reducing government overreach and lowering energy costs.
He will strategically employ tariffs to protect our national security, better position U.S. businesses for growth and to bring back jobs.
Trump’s Department of Government Efficiency headed by two of the most competent CEOs in the U.S. today, Elon Musk and Vivek Ramaswamy, has been tasked to further and materially reduce both the size and cost of government. It’s hard to imagine a better team for the job.
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There is no scenario in which a Biden, Harris or any other Democrat administration could pursue such an effective and common sense solution or achieve its goals.
When President Trump brings the economy back from the brink, Biden and his Democrat allies will deserve no credit and, in a rational world, they will get what they deserve.
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