“The Earned-income tax credit is a very effective way to increase both incomes and labor force participation.

The credit, a government subsidy paid through the redistribution of tax revenues, does not, in this view, create an incentive for employers to automate or off-shore since corporate wage costs do not increase: Stevenson is quoted as saying that raising and expanding eligibility for the Earned-income tax credit would be an effective way to immediately raise income of poorly paid workers. But many low-income jobs are being replaced by automation. Tour operators, bike rentals and boardwalk shops typically close for winter.Ī commentary in The New York Times entitled, Why Do We Pay So Many People So Little Money? notes that thanks to the advent of the coronavirus, much of the public has become aware of its dependence on low income workers. For a lot of businesses in coastal vacation towns, summer isn’t just the season - it’s the only season. That destruction will reach beyond young people to workers of all ages who may take on second jobs in the summer to earn extra cash. “What we’ll actually see is not the season not coming, but it coming in such a partial way that there’s a lot of job destruction,” she said. This year is going to be tough on people who work in travel, tourism and restaurants, which hire a lot of seasonal workers. Young served in the Treasury Department and the Office of Management and Budget.Ford School economics professor Betsey Stevenson was featured on NPR’s Marketplace, which noted that, “Summer has arrived lots of summer jobs have not.” Yet while falling short of his hope, it sets up a strong second year - and an even stronger cause/effect relationship with his tax reform victory. His first year economy’s performance was solid, but not spectacular. Obama’s, but with ample room to show tax reform’s boost. It offers the perfect comparison between the Obama and Trump economies: Far better than Mr. However the third and most important, the economy, is proving to be just right. The one too cold may prove to be this year’s. The one too hot was last year’s stock market. Instead he finds three bowls of porridge. They cannot help wondering how he could wander into a den of bears and not get mauled the way Mr. As its effect is felt, especially accelerating economic growth, expect greater popularity. Politically, tax reform’s popularity is beginning to rise, despite unmitigated battering in the press. The Atlanta Fed’s economic model projects 5.4 percent growth for the first quarter. And if 2018 also turned out to be good, critics would have said it was no better than 2017 - so there was neither effect from, nor point to, tax reform.Īlready there are signs 2018 is ready to deliver economically. Obama’s acolytes have tried to credit the former administration for the current’s success. Had 2017 been too hot, it would have been attributed to luck - just as Mr. Never mind that it would have been in-line with Mr. Yet 2017’s biggest contribution will not be in the recovery it started, but in the clear demarcation it provides for his signature achievement. It was also better than the 1.5 percent annual average during President Obama’s eight years. Its growth rate was far better than 2016’s 1.6 percent. That’s all the better politically for Mr. Second, when you sign it - and, like tax reform, it would not have happened without you - you doubly do.įurther, tax reform gives Mr. As president, you own what happens on your watch. Trump, it sets him up for credit from the widely expected growth.įirst, tax reform happened on Mr. Trump did not get until the very end of 2017 with tax reform. Yet in politics it is tangible action that counts. Absolutely, the expectation anti-business policies will not prevail is a boost. True, increased national confidence helps. While Trump could have claimed ownership for a great first year - and any president would - he lacked a significant policy to attribute growth to.

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