CBO Releases Proof Trump Tax Cuts are Working

Are Trump’s tax cuts working? While a full economic analysis of the tax cuts and their effects on all sectors of the American economy is something that may have to wait a decade, there is evidence that they’re boosting growth so far.

How do we know? Because prior to the tax cuts, the Congressional Budget Office (CBO) published estimates for how they thought the American economy would perform in 2018. Those estimates projected 2% economic growth in 2018, but those numbers are now drastically higher.

The CBO released new GDP growth projections earlier this month and projected that real GDP will grow by 3.3% from the fourth quarter of 2017 to the fourth quarter of 2018. The American economy hasn’t grown by over 3% in a single 12-month period under Barack Obama’s presidency, and this would mark a 15 year high in economic growth.

According to CNS News:

The last time real GDP grew by more than 3.3 percent from the fourth quarter of one year to the fourth quarter of the next was in 2003, when it grew by 4.4 percent, according to the historical data published by the Bureau of Economic Analysis.

CBO Director Keith Hall told the House Budget Committee in testimony on April 12. “Most of this growth is driven by consumer spending and business investment, but federal spending also contributes a significant amount this year.”

Hall testified that the tax law signed by President Donald Trump at the end of last year is stimulating economic growth. “In our projections, the effects of the 2017 Tax Act on incentives to work, save and invest, raise real potential GDP throughout the 2018 and 2028 period,” he told the committee. “Over the same period, the Tax Act is projected to boost the level of real GDP by an average of 0.7 percent and nonfarm payroll employment by an average of 1.1 million jobs.”

Last month, the CBO revised upwards their estimates for GDP growth in the 4th quarter of 2017 to 2.9%. That followed gains of 3.1% in the second quarter and 3.2% in the third quarter, making it the strongest nine-month stretch of growth in a dozen years.

Are you benefiting from the Trump tax cuts? Let us know in the comments section below!