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Tax Reform, Trade Policy, Financial Regulation, and Natural Disasters
Tax Reform, Trade Policy, Financial Regulation, and Natural Disasters
Boston, MA
November 2nd, 2018
Trump Administration
How are the policies of the
Trump administration impacting
the U.S. economic outlook?
– Personal
• Lower tax rates
• Nearly doubles standard deduction
• Caps mortgage and SALT deductions
– Corporate
• Tax rate 35% to 21%
– Repatriation @ 15.5%
• Immediate expensing for small business
• Pass through income
U.S. Forecast
2000.0
1500.0
1000.0
500.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Real After Tax Profits
U.S. Forecast
Private Fixed Nonresidential Investment
(Billions of Dollars)
3500.0
3000.0
2500.0
2000.0
1500.0
1000.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Private Fixed Nonresidential Investment
U.S. Forecast
Federal Budget Surplus
(Billions of Dollars)
0.0
-200.0
-400.0
-600.0
-800.0
-1000.0
-1200.0
-1400.0
-1600.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Federal Budget Surplus
Trump Administration
• Much needed regulatory relief
• Agencies have:
– Withdrawn 653 regulations
– 244 regulations made inactive
– 700 regulations delayed
The Rules of the Game
Matter
• Federal Regulation and
Aggregate Economic Growth
by John W. Dawson and John J.
Seater
• Journal of Economic Growth
(2013) 18:137-177
• Productivity is impacted by
regulatory growth
T.A.R.P.
Foreclosure Prevention Act 2009
ARRA of 2009
Affordable Care Act
Dodd-Frank
U.S. Forecast
U.S. Forecast
U.S. Forecast
U.S. Forecast
Total Nonfarm Payroll Employment
(Millions)
155.0
150.0
145.0
140.0
135.0
130.0
125.0
02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20
Total Nonfarm Employment
U.S. Forecast
4.0
2.0
0.0
-2.0
-4.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Real Disposable Income Consumption
U.S. Forecast
Automobile and Light Truck Sales
(Millions Vehicles)
14.0
12.0
10.0
8.0
6.0
4.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Auto Sales
Light Truck Sales
U.S. Forecast
Real GDP Growth and Federal Funds Rate
(%)
10.0
5.0
0.0
-5.0
-10.0
03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21
Quarterly Growth Rate Real GDP Fed Funds Rate
U.S. Forecast
GDP
% Change, Annual Rate 1.5 2.4 3.2 3.6 2.8
Consumption
% Change, Annual Rate 2.7 2.7 3.2 3.8 3.6
Hurricane Impacts
• Employment impacts
Hurricane Impact
Employment
Quarterly Forecast Publications
Available
Download at:
WWW.IEC.UCF.EDU
Thank you
Sean M. Snaith, Ph.D.
Director
Institute for Economic Competitiveness
(407) 823-1453
Sean@SeanSnaith.com
WWW.IEC.UCF.EDU
www.facebook.com/seansnaith
Twitter: @seansnaith