President Donald Trump began the year in a strong position to win reelection, in large part due to the best economy in generations. Under Trump, the unemployment rate had fallen to around half-century lows, workers (and disproportionately low-income workers), saw their first real wage gains in a decade, and people reported record confidence in their personal finances.
But thanks to the coronavirus and the resulting lockdowns, in a matter of weeks, the economy came crumbling down, with 22 million people reporting joblessness in the past month alone and second-quarter GDP loss projections reaching as high as 40%.
All of this poses a problem for Trump. But it’s possible that it proves an even worse one for Joe Biden.
Although the de facto Democratic presidential nominee ran well to the center of the majority of his competitors, Biden still took the bait to endorse many of their policies, including a pledge to repeal Trump’s Tax Cuts and Jobs Act. The media worked overtime to convince the country that the law was a tax cut for the wealthy, and that may have worked for a time. But two years into Trump’s first legislative achievement, the people know better, namely, that unless you’re a high-dollar, white-collar earner in a heavily blue state and, thus, slapped with the SALT deduction cap, it was overwhelmingly likely that you saw a tax cut.
It’s one thing for Biden to argue for a tax hike while the economy is booming. But it’s another to want to hike taxes on small businesses, when 1 in 4 reports being just two months from extinction, and hike rates on the individuals still earning cash and driving our direly necessary consumer spending.
If Biden actually followed through on his promise, it would devastate just about everyone. Americans for Tax Reform crunched the numbers, and they’re not pretty. For a family of four earning the nation’s median income of $73,000, taxes owed would increase by $2,000. A single mother of one child making $41,000, less than 250% of the federal poverty line, would owe an extra $1,300 in taxes.
The child tax cut would be slashed in half for millions of households across the board, and millions of the country’s most unprivileged would be hit with the return of the individual mandate tax. And none of that is to mention that tens of millions more of these people would lose their jobs when small businesses, on the cusp of permanent closure, are hit with the repeal of the 20% deduction for small business income.
Biden is in a bind. Does he rely on his record of the Obama administration presiding over the slowest economic recovery of all time?
Or does he commit to his promise of fulfilling his party’s laundry list of spending plans by punishing hundreds of millions of people and threatening their livelihoods?
Biden can’t run on his past, and now, he can’t run on his promises. Stuck in a Wilmington basement with an unrelenting left still trying to tether him to its socialist fantasies, he’s not left with many other campaign strategies than to wait and ride the coronavirus wave.
The Washington Examiner