A new study has revealed that the economic proposals Republican nominee Donald Trump is putting forward would increase the federal deficit by $5.8 trillion in the next 10 years.
The Penn Wharton Business Model conducted a separate study that found that the economic proposals that Democratic nominee Kamala Harris is putting forward would increase the deficit by $1.2 trillion.
According to the report on Trump, $4 trillion of that total is associated with the former president’s proposal to permanently extend the tax cuts he first put into place in 2017. Eliminating taxes that are paid on Social Security benefits would increase the deficit by another $1.2 trillion, the report found.
Trump’s plan to reduce taxes on corporations would also add almost $6 billion to the deficit.
According to the analysis of the Harris proposals, her package of tax credits — including expanding the earned income tax credit and the child tax credit — would add $2.1 trillion to the deficit over the next 10 years.
A subsidy she’s proposed of $25,000 to first-time homebuyers who qualify would add another $140 billion to the deficit.
The same report found that Harris’ proposal to increase the corporate tax rate from 21% to 28% might help offset some of those costs by about $1.1 trillion.
Harris has also said that she’s in support of some of the revenue-increasing measures that are included in the 2025 fiscal year budget proposal that President Joe Biden presented recently. Those measures are estimated to bring in an addition $5 trillion of revenue for the federal government.
Trump has said that the way he plans to pay for the measures in his economic proposals is to place a 10% tariff on all imports, as well as a 60% tariff on all Chinese imports.
Those proposals wouldn’t need to first be passed through Congress before he could implement them. The former president has long said that trade policies such as these would be able to generate sufficient domestic growth over the long term to outweigh what would be the short-term costs his economic proposals would create.
Mark Zandi, the chief economist for Moody’s, estimated that the tariffs that Trump is proposing would generate about $2.5 trillion in additional revenue.
He also warned that taking a hard-line approach like that to tariffs could reignite inflation, which is finally starting to get under control, with prices beginning to come down.
Both campaigns are trying to paint each other as a danger to the U.S. economy, as they look to attract voters who are tired of having to pay so much for everyday living.
Karoline Leavitt, a spokesperson for the Trump campaign, issued a statement recently defending the economic policies Trump is putting forward. She said:
“President Trump is a businessman who built the greatest economy in American history, and certainly doesn’t need economic lessons from the radical San Francisco liberal pushing Communist price controls.”
