President Trump signs tax reform bill, as nation looks toward uncertain 2018
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President Trump has signed his tax reform bill, aimed at providing tax cuts for most Americans as well as simulating job growth. President Trump signed the bill early to offer it as a Christmas gift to the American people.
President Trump signed the tax cut bill early as a Christmas present for the American people.
LOS ANGELES, CA (California Network) - President Trump has signed his tax reform bill, with $1.5 trillion in cuts. The bill, signed on Friday morning, was passed early to serve as a Christmas present to the American people. According to President Trump, people should see bigger paychecks in February.
"I think it's selling itself," the President said. "It's becoming very popular. You'll see something on February 1 when they open up the paycheck... I didn't want you folks to say that I wasn't keeping my promise. I'm keeping my promise. I'm signing the bill before Christmas."
In addition to signing the tax cut bill, President Trump also signed a government spending bill that will keep the government operating though January 19. After Christmas, legislators are expected to agree on a government spending bill.
In the wake of the tax cut bill, several companies said they would pay workers bonuses. AT&T, Wells Fargo, Boeing and Comcast have all pledged bonuses to their workforces in celebration of the cuts. AT&T pledged their bonus which will be immediately paid to more than 200,000 workers is $1,000.
AT&T also pledged to make more than $1 billion in new investments in the U.S. next year.
Opponents of the tax reform bill have pointed out that corporate America is enjoying the lion's share of the benefits with massive corporate tax cuts. This is true. However, the pledge is that in exchange for these cuts, corporate bosses will spur spending and hiring.
If corporate America keeps its promises to the president and the people, then we can expect a robust 2018 with excellent job growth and new infrastructure upgrades. Such improvements would do much to bolster the economy and increase the president's popularity.
However, there is room for concern. It is possible that a recession looms, since the bull market has already lasted well beyond all expectations. The Federal Reserve has signaled their intention to raise interest rates and worker's wages have remained stagnant.
Higher interest rates and low wages can suppress spending and stall the economy, triggering a recession. And with the market on a bubble, the next recession is likely to be deep.
The tax cuts will offset recessionary pressures, and will put more money into worker's pockets. However, the middle class tax cuts expire over time and if wages don't rise to offset the expiring cuts, then consumer spending will stall and recession will follow.
The Trump tax bill is an important measure, one that should at least stall any recession for up to a year or more. However, progressive measures will have to follow, specifically in the form of higher wages. Without those measures, the economy will eventually go bust and there is no way to predict how large the next recession will be.
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