The Washington Post - 22.08.2019

(Joyce) #1

A16 EZ RE THE WASHINGTON POST.THURSDAY, AUGUST 22 , 2019


core element of his appeal to
blue-collar workers in the
Upper Midwest who helped
deliver his victory. Long
reported that “Trump’s tax cuts
helped boost manufacturing in
2018 (blue-collar job growth hit
the fastest pace since the early
1980s), but the president’s
tariffs have since taken a toll,
sending manufacturing into a
‘technical recession’ in 2019.”


  1. Boosting economic
    growth. Trump campaigned on
    a promise to goose economic
    growth as high as 5 or 6
    percent. “We’re bringing it from
    1 percent up to 4 percent. And I
    actually think we can go higher
    than 4 percent. I think you can
    go to 5 percent or 6 percent,”
    Trump said in October 2016.
    After approaching 3 percent
    last year thanks in part to
    stimulus provided by the tax
    cut and higher federal
    spending, growth has slowed
    this year and is now on track to
    settle in at around 2 percent,
    per the Fed. And nearly three in
    four business economists now
    say they expect Trump’s policies
    will tip the U.S. economy into a
    recession by the end of 2021.
    tory.newmyer@washpost.com


goods they ship to the U.S.
Trump came the closest to an
acknowledgment that domestic
consumers are in fact on the
hook when he last week
postponed some import duties
set to hit next month until mid-
December, a move he said was
aimed at shielding Christmas
shoppers. Multiple studies,
however, confirm that American
businesses and consumers are
already shouldering the vast
majority of the tariffs.
JPMorgan Chase economists
now estimate Trump’s existing
tariffs are costing the average
American household $600 a
year, a sum that will rise to
$1,000 if he follows through
with the next round of levies.


  1. Lowering the trade
    deficit. The president’s
    animating drive in his trade
    offensive has been reducing
    America’s trade deficits with its
    key trading partners. As my
    colleague Heather Long noted
    Tuesday, the U.S. trade deficit
    has actually grown during
    Trump’s presidency to
    $633 billion.

  2. Reviving manufacturing.
    Trump also pledged to usher in
    a manufacturing renaissance, a


has amounted to a deregulatory
bonanza for Wall Street,
including most recently a
rewrite of the “Volcker rule”
that megabanks have been
agitating for since the
imposition of the post-crisis
rules on the industry. The entire
drive has raised alarms among
former Federal Reserve
officials, who have voiced
concerns that the changes could
exacerbate the next downturn.


  1. Eliminating the debt.
    Trump as a candidate promised
    to eliminate the federal debt
    within eight years. Instead, he’s
    on track to leave it 50 percent
    higher. The deficit is swelling to
    over $1 trillion annually, partly
    because of diminished revenue
    as a result of Trump’s
    $1.5 trillion tax cut (which the
    administration pledged would
    pay for itself, though it isn’t)
    and higher federal spending.

  2. Protecting consumers
    amid the trade war. The
    president has insisted
    throughout his trade war with
    China that American
    consumers have been held
    harmless while Chinese
    exporters bear the burden of
    tariffs he’s imposed on the


package. Trump campaigned on
a promise to pursue a major
infrastructure package, an
initiative that moved to the back
burner as soon as he took office.
But he has returned to the issue
repeatedly, vowing to
implement “the biggest and
boldest infrastructure
investment in American
history,” and pledging at least a
half-dozen times to make the
matter a top priority. The
project has gone nowhere. And
the administration’s attempts to
build momentum for it by
declaring an “Infrastructure
Week” have become Washington
shorthand for its hapless efforts
to stay on message amid
nonstop controversies.


  1. Breaking up the big
    banks. The president also
    campaigned on a pledge to
    break up the big banks by
    restoring the Glass-Steagall
    Act’s firewall between
    commercial and investment
    banking. Back in 2016, he said
    he was “not going to let Wall
    Street get away with murder.
    Wall Street has caused
    tremendous problems for us.”
    But his handpicked
    regulators have pursued what


White House watchers. The
president frequently undercuts
staff members denying reports
that a move is imminent or
being actively considered. More
importantly, the episode
conforms to a pattern of Trump
making promises about his
economic program that he later
abandons or that fail to bear
fruit.
Here’s a look at some of those
broken promises:


  1. The 2018 middle-class tax
    cut. Most similarly, Trump
    spent the weeks leading up to
    the 2018 midterms talking up a
    10 percent tax cut for the middle
    class that he said congressional
    Republicans would unveil after
    the election. “It’s going to be put
    in next week, 10 percent tax
    cut,” Trump told a Houston
    crowd at an Oct. 22 rally. The
    president claimed he’d been
    working on the plan for months
    with then-House Ways and
    Means Committee Chairman
    Kevin Brady (R-Tex.), though
    Brady at the time directed
    questions about it back to the
    White House. The effort
    unraveled before a proposal was
    unveiled.

  2. A major infrastructure


If you’re feel like
you’re suffering
from some
disorienting deja
vu trying to
follow the Trump
administration’s
latest position on
a payroll tax cut, it isn’t just the
August heat.
President Trump on
Wednesday reversed himself
from a day earlier by declaring
he is no longer considering the
move. That about-face came
after the president on Tuesday
afternoon upended a day’s
worth of denials from senior
White House aides that such a
plan was under consideration,
telling reporters he was in fact
mulling a temporary cut to keep
some extra money in Americans’
pockets.
“I’m not looking at a tax cut
now,” Trump said Wednesday.
“We don’t need it. We have a
strong economy.” On Tuesday, he
said the “payroll tax is
something that we think about,
and a lot of people would like to
see that.”
The president’s two-day
round trip on the issue fits a
track record by now familiar to


PowerPost


INTELLIGENCE FOR LEADERS  WASHINGTONPOST.COM/POWERPOST

Talk of payroll tax cut calls to mind Trump’s other reversals


The
Finance
202


TORY
NEWMYER


BY DANIELLE
DOUGLAS-GABRIEL

President Trump moved
Wednesday to grant veterans
who are severely disabled auto-
matic federal student loan for-
giveness, rather than requiring
them to fill out paperwork for a
benefit provided by law.
“They have made a sacrifice
that is so great,” Trump said in a
speech to the AMVETS national
convention in Louisville.
“It’s gone forever,” Trump said
of the debt.
Veterans are eligible to have
the government discharge their
federal student loans if the De-
partment of Veterans Affairs
deems them totally and perma-
nently disabled. Few have taken
advantage of the discharge, in
part because it has never been
widely publicized.
The Education Department
announced a partnership with
VA in December 2016 to identify
eligible veterans, who would
then need to sign and return an
application to complete the proc-
ess. Work on the project, howev-
er, did not get underway until
April 2018. The Education De-
partment did not immediately
respond to requests for comment
on the delay.
Still, the effort has fallen short


of its potential. A Freedom of
Information Act request made by
the advocacy group Veterans
Education Success found that

the Education Department con-
tacted more than 42,000 dis-
abled veterans, 25,000 of whom
were in default on their student

loans. Yet barely 8,500 had
signed and returned the applica-
tion for a discharge as of May
2018.

To date, the partnership be-
tween the Education Depart-
ment and VA has resulted in the
federal government providing

more than $650 million in stu-
dent loan relief to more than
22,000 eligible veterans.
The nonprofit Student Bor-
rowers Protection Center said
many veterans may have been
reluctant because of the per-
ceived tax implications of loan
forgiveness. Until recently, the
federal government treated
money forgiven through a dis-
ability discharge as taxable in-
come. The tax overhaul signed
into law last year put an end to
the government counting as tax-
able income student debt that is
forgiven because of death or
disability.
When the federal tax burden
was lifted, consumer advocates
and state attorneys general
urged Education Secretary Betsy
DeVos to automatically cancel
the debts amassed by disabled
veterans. The department said
potential state and local tax lia-
bilities tied to forgiveness re-
mained a concern.
On Wednesday, the Education
Department noted that veterans
can opt out of the automatic
discharge in the event they are
worried about the state tax im-
plications.
“Supporting and caring for
those who have sacrificed much
in service to our country is a
priority for President Trump and
the entire Administration,” De-
Vos said in a statement Wednes-
day. “We will continue to priori-
tize the needs of our nation’s
veterans and provide them the
help and support they have
earned and deserve.”
danielle.douglas@washpost.com

Trump to automatically forgive student debt for permanently disabled vets


SCOTT OLSON/GETTY IMAGES
Guests at the AMVETS convention in Louisville listen to President Trump on Wednesday, when he lauded veterans for their sacrifice and
said his administration would now automatically cancel student debt for the totally and permanently disabled: “It’s gone forever.”

Program had required
signed application, but

many weren’t taking part


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