There are a lot of issues that Mr. Trump will need to address during his presidency. The key is to understand how will Trump effect the US.
How will Trump and Congress get along?
Republicans have control of the White House, the Senate and the House, but that doesn’t mean he will have an easy time on Capitol Hill. The GOP was badly fractured throughout the primary and general election season, as Trump insulted his way through 17 Republican opponents.
Several big names in the party, including former Florida Gov. Jeb Bush, Ohio Gov. John Kasich, Arizona Sen. John McCain and 2012 nominee Mitt Romney refused to support Trump, and House Speaker Paul Ryan would not campaign with him. Trump will have to build support with his former opponents to push his populist agenda into law.
“Promises and Price Tags” is a comprehensive fiscal analysis of the policies put forward by presidential candidates Donald Trump and Hillary Clinton. The full report is available as a printer-friendly PDF (57 pp.), and the Chartbook can be viewed here.
The next president will enter office with the national debt at post-World War II record high levels. Debt held by the public currently totals over $14 trillion. This is nearly 77 percent of Gross Domestic Product (GDP). The debt is projected to grow as a share of the economy to almost 86 percent by 2026 and about 150 percent by 2050. Our growing national debt threatens to slow economic growth and is ultimately unsustainable. Yet neither presidential candidate has a plan to address it.
This growing debt is largely the result of rising entitlement spending and growing interest costs. Social Security, federal health spending, and interest costs are projected to be responsible for over four-fifths of spending growth over the next decade. Keep in mind that the interest being the fastest growing area of the budget.
Ever-rising levels of debt are unsustainable. Which means that at some point policymakers will need to slow spending growth, increase revenue, or do both. The national discussion surrounding and the political promises made during the 2016 election can lay the foundation for necessary changes in fiscal policy.
Encouragingly, both of the major parties’ presumptive presidential nominees have highlighted the need for fiscal responsibility on the campaign trail. Unfortunately, to date neither former Secretary of State Hillary Clinton nor businessman Donald Trump has put forward a plan to address the national debt.
Altogether, accounting for both the TARP and the Fannie and Freddie bailout, $619B has gone out the door—invested, loaned, or paid out—while $390B has been returned.
The Treasury has been earning a return on most of the money invested or loaned. So far, it has earned $298B. When those revenues are taken into account, the government has realized a $69B profit as of Mar. 31, 2016.
Where do these numbers come from?
Most of the data shown comes from the Treasury Department. But in a few cases, we’ve gathered information from other government agencies or press releases and regulatory filings from bailout recipients.
Not much has changed in the financial status of the Social Security Trust Funds since last year, according to today’s release of the annual report on the status of the funds by the Social Security Board of Trustees.
The combined asset reserves of the Old-Age and Survivors Insurance, and Disability Insurance (OASDI) Trust Funds are projected to become depleted in 2034, the same as projected last year, with 79 percent of benefits payable at that time.
The DI Trust Fund will become depleted in 2023, extended from last year’s estimate of 2016, with 89 percent of benefits still payable.
In the 2016 Annual Report to Congress, the Trustees also announced:
·The asset reserves of the combined OASDI Trust Funds increased by $23 billion in 2015 to a total of $2.81 trillion.
·The combined trust fund reserves are still growing and will continue to do so through 2019.
·Beginning in 2020, the total cost of the program is projected to exceed income.
·The year when the combined trust fund reserves are projected to become depleted, if Congress does not act before then, is 2034 – the same as projected last year. At that time, there will be sufficient income coming in to pay 79 percent of scheduled benefits.
Doug and Tammie discuss how some countries are spending their money and where the US compares as a whole.
Though the chart, created by the Data Team with The Economist, may be lacking in how countries are taxed or not taxed it is an interesting glimpse into the wallet of a few of the countries spending habits. Some of the differences are accounted for by pure economics of a country. However, in the end US Healthcare costs are taking up the biggest portion of our American dollars.
Click on the chart link below or follow the link above to take a closer look:
Greek MPs are to debate new proposals sent to the country’s creditors with the aim of getting a third bailout and averting a possible exit from the euro. The plans contain controversial elements, including pension reforms and tax rises, that were rejected at a referendum called by PM Alexis Tsipras. The EU and other creditors are studying the plans before a summit on Sunday. France and Italy welcomed the proposals but Germany, Greece’s biggest creditor, warned of little room for compromise. Continue reading “Greek Debt Crisis: Greek MPs to Debate Controversial Reforms Plan”
This has been a very volatile week in the market. Here are the major headlines:
The International markets have been riding the rollercoaster in Greece as they vote on a referendum that affects the stability of the Eurozone.
Jobs Report (Non-Farms Payroll) was weaker than expected. There were 223,000 Jobs created in June, below the 233,000 expected. Additionally, May’s blockbuster number of 280,000 was revised lower to 254,000 and April’s figure of 221,000 was revised lower to 187,000. Meaning that there 60,000 in combined revisions lower for the past two months.
Unemployment rate declined from 5.5 to 5.3%, which appears to be strong. However when we dig deeper, we see the main reason why is because the labor force decreased by 432,000 people. The Household Survey, where the unemployment rate is derived from, actually showed a loss of 56,000 jobs. We would have seen an increase in the unemployment rate if such a large number of workers did not leave the labor force. The labor force participation rate declined 0.3% to 62.9%, which is the lowest level in 38 years. Unemployment in Missouri was slightly above the national average at 5.7%, while St. Louis was 5.5%.
The European Central Bank announced on January 22, 2015 that they would begin buying bonds worth 60 millions euros ($69.7 billion) a month. The quantitative easing bond buying program will last from March 2015 until September of next year. The ECB should end up purchasing over 1.1 trillion euros in assets.
The announcement comes as a result of the Eurozone being in deflation territory. In December inflation of the 19 member Eurozone fell into the negative territory. If prices continue to decline there could be crucial consequences for the economy. By increasing the money supply there should be an upsurge of investment and spending in the economy, creating employment opportunities and helping economic growth. Continue reading “Understanding The Impact of A Strong Dollar”