The latest Census Bureau Current Population Survey data now show that middle-class incomes, adjusted for inflation, have surged by $5,003 since Donald Trump became president in January 2017. Median household income has now reached $65,976 – an all-time high and up more than 8% under the Trump presidency.
These numbers contrast starkly with the 16 years prior to Trump’s presidency. In the eight years that George W. Bush was president, median income barely showed any gain, up just $401 thanks to the deep recession of late 2007 to early 2009.
During the post-recession years of President Barack Obama’s two terms, incomes inched up by $1,043. This means that in the 16 years before the Trump presidency, incomes rose by less than $1,500 — while in less than three years under Trump, middle incomes have risen over three times faster – again based on Census Bureau data.
The income numbers above are PRE-TAX, so they do NOT include the impact of the Trump tax cut. The Heritage Foundation estimates that the average household has saved $1,400 a year on their federal taxes from the 2017 Trump tax cut. This means many working-class families now have a $6,000 higher after-tax, and after-inflation paycheck today.
These surges in income under Trump have occurred at exactly the time when many liberals and media talking heads were shouting “recession.” In reality, middle-class families are enjoying a near-unprecedented income windfall!
These higher wage and salary incomes are no doubt related to the very tight labor market, which has given workers new bargaining power to ask for higher pay. Today there are more than seven million unfilled jobs in America – the highest number of surplus jobs in American history.
These latest income numbers also squarely contradict the claims by Democratic presidential candidates — such as former Vice President Joe Biden and Senators Elizabeth Warren and Bernie Sanders — who claim that all the gains from the Trump economy have gone to the rich and large corporations. Warren claimed earlier this year that workers had to work “two or three or four jobs” just to keep their incomes from falling.
No, this has been one of the biggest middle-class success stories in modern times, and it is a testament to the success of the Trump tax cuts, deregulation and energy policies. Keep this in mind as the presidential race heats up just ahead, and the Democrats continue to promote the lie that Trump’s tax cuts and deregulation only benefited the rich and greedy corporations.
Hat tip to Stephen Moore, one of my favorite writers, and Fox News for bringing this to my attention.
US Budget Deficit Highest in 7 Years, Almost $1 Trillion
The federal budget deficit for fiscal year 2019 grew to $984 billion, or 4.7% of GDP, the highest since 2012, the Congressional Budget Office reported on Monday. The total for 2019 is 26% higher than the 2018 deficit and 48% above 2017 levels. The CBO noted that the deficit has now grown as a percentage of the economy for four straight years.
Revenues in fiscal 2019 totaled just under $3.5 trillion, up 4% from 2018, the CBO reported. Spending in fiscal year 2019 was $4.45 trillion, up $338 billion, or 8%, over 2018 – thus resulting in the deficit of $984 billion.
Net interest payments on the public debt rose by $52 billion, or 14%, because of higher average interest rates on short-term debt compared with 2018, and because the federal debt was larger than in the previous year.
The largest spending increase among federal agencies was at the Department of Defense (up $47 billion, or 8%). Outlays for Social Security and Medicare each rose by 6%, while Medicaid spending rose by 5%. In all, the federal government’s outlays exceeded the CBO’s August projection by $35 billion.
The CBO projects that the annual federal deficit will rise to more than $1 trillion annually for the foreseeable future beginning in fiscal year 2020, which just started on October 1. How much more than $1 trillion per year is uncertain.
Yet if the annual budget deficits climb by just $1 trillion a year, our national debt will soar from $22.5 trillion now to $32.5 trillion or more by 2029. That’s a nearly 50% increase in just a decade.
The questions are: 1) Can our financial markets handle it; and 2) Will lenders continue to gobble up Treasury securities as our national debt continues to soar? I wouldn’t bet on it! This movie will end very badly at some point, in my opinion. Of course, I’ve been saying this for years.
Sorry, comments are closed for this post.