Kamalanomics: Way Better Than Trump—But Not as Good as Biden

Bloomberg’s Eric Wasson and Enda Curran estimated last month that Trump’s promised tax cuts added up to $10.5 trillion over the next decade. And that was before Trump pledged to eliminate a $10,000 cap on deducting state and local taxes (tax nerds call this this “SALT cap”) that Trump himself imposed in 2017, in a halfhearted attempt to limit revenue losses from his 2017 tax giveaway to corporations and rich people. Reversing the SALT cap—a rare instance of progressivity in that 2017 tax bill—would increase Trump’s total revenue losses to nearly $12 trillion. 

Writing in The American Prospect, David Dayen calculates a more modest tally for Trump revenue losses: $9.75 trillion. For comparison’s sake, the cost of running every agency except the Pentagon over the next 10 years, Wasson and Curran noted, is $9.8 trillion. To pay for all his tax cuts, then, Trump would either have to dismantle the entire federal government (except the Pentagon)—and, if Bloomberg’s calculations are correct, would still come up $2 trillion short!—or increase deficit projections over the next decade by 50 percent. (Trump would of course do the latter.)

Believe it or not, Bloomberg’s estimate, even with cancellation of the SALT cap added in, is a lowball figure. Dayen says his estimate’s a lowball as well. As I observed last month, Project 2025’s tax proposals—in a Mandate for Leadership chapter coauthored by Stephen Moore (whom Trump tried unsuccessfully to elevate to the Federal Reserve’s Board of Governors, and who is now advising Trump’s campaign)—would drop the top marginal income-tax rate from 37 percent to 30 percent; drop the corporate tax rate (“the most damaging tax in the U.S. tax system”) from 21 percent to 18 percent; and lower the capital gains tax from 20 percent to 15 percent (something Trump himself called for when president). Also, Trump wants to create a sovereign wealth fund. In principle, that isn’t an awful idea, but we can’t afford one (especially if Trump becomes president).