With the Democratic and Republican parties having over 20 candidates in the primaries between them, the contenders will be bringing a plethora of economic strategies to the table. However, much like the presidential hopefuls themselves, only a handful of the plans have a good chance of being implemented. For this reason, I have decided to focus on the economic policies of the top three Republican candidates; Donald Trump, Jeb Bush, and Scott Walker, and the two top Democrats; Hilary Clinton and Bernie Sanders
Donald Trump (R) – Celebrity Businessman
Best known for his role in the US version of The Apprentice, A major policy proposal is to enact enormous trade tariffs on goods imported from Mexico and China. His second most notable proposition is to repeal President Obama’s healthcare bill. Mr Trump regards the law as disastrous. However, he seems to view healthcare as a fundamental right, rather than a service that a privileged few can afford; in a July interview he stated: “You can’t let the people in this country, the people without the money and resources, go without health care”. A marked difference from most Republicans, who favour healthcare provision devoid of governmental oversight. The multitude of attempts to repeal Obamacare is good indicator of this. A third policy is tax cuts, with the aim to halt corporate income tax, and estate tax, and a reduction on capital gains and personal income tax. Mr. Trump wishes to lower the latter from the top rate of 40% to 15%.
Why should this policy be implemented?
Trumps views on healthcare are surprising, tax cuts and trade tariff not withstanding, a genuine, comprehensive, universal healthcare policy would likely benefit millions, and bring the US into the fold of the remainder of the industrialised world.
Why not?
Trump’s tariff measures, are likely to poison Sino-American and Mexican-American relations, he also risks, “A major trade war that would likely hurt American Jobs and Exports.” The very thing Mr Trump is trying to protect. His substantial tax reductions will likely burgeon the already colossal national debt. Furthermore, the healthcare measures for those unable to pay will need to be appropriately costed.
Jeb Bush (R) – Former governor of Florida
Mr Bush presided over significant economic growth during his tenure, witnessing significant increases in the tourism and housing industry, and a GDP rise of 4.4% on average whilst in office. If elected, he would aim for 4%, looking for a 19 million increase in jobs. Regarding healthcare, Mr Bush takes a very similar approach to Mr Trump. In March of this year, he referred to Obamacare as a “monstrosity.” It is his aim to see it eventually replaced by a Republican alternative. What this alternative is remains to be seen. Nonetheless, much like Mr Trump, Mr Bush sees a role for the government in helping people out; “catastrophic” illness or injury, when an individual might accrue high costs, would be covered by state of federal government funds.
On the subject of taxes, Mr Bush has remained ambiguous. As governor of Florida, he clearly favoured the trickle-down economic approach, cutting taxes on the wealthy, linking it to the siginifcant growth Florida experienced on his watch. Running for the president may well have sparked a change. He has not eliminated the possibility of raising taxes on wealthier citizens, a departure from many others in the republican field. His tax plans will hopefully become more transparent in the coming weeks, and with the forthcoming debate roughly a month away, he will have plenty of time to formulate a clearer policy proposal.
Why should this policy be implemented?
Mr Bush’s healthcare proposal is not universal. However, his aim to support those with federal money who suffer catastrophic illness or injury is admirable and a step in the right direction. Rather than simply jabbing at the President, he does at least have some sort of replacement, in spite of its grounding.
Why not?
His economic record is not as watertight as he makes out. Shortly after leaving office as Governor, Florida’s economy suffered the effects of recession. Furthermore, the tax cuts were widely perceived to benefit the wealthy, and many home buyers who benefited from large loans were subsequently unable to pay them back. That said, him bearing the brunt of responsibility for the crash or boom is a matter of debate but it does imply that Mr Bush could well implement policies that predominately favour wealthy citizens. And if the cuts during his time as governor did contribute the crash, applying them on a national scale might have a similar effect.
Scott Walker (R) – Incumbent governor of Wisconsin
The policies
Mr Walker likewise follows the traditional Republican line, viewing tax cuts as being fundamental to economic growth, having overseen a reduction in tax predominately directed at those earning between $15,000-$50,000. Whether he will apply this on a national level remains to be seen. Like Mr Bush, Mr Walker has yet to provide comprehensive details on his federal taxation plans, though it is believed he will argue for wide ranging tax cuts. It seems likely though that we will provide greater clarity as the debates and primaries draw nearer. His views on healthcare, however, are much less ambiguous. It should come as no surprise that he, like his fellow Republicans, views Obamacare with considerable distain, pledging to repeal it immediately upon entering office. The replacement will be to give states more power in the matter; namely to operate Medicare provisions, to link tax refundable credits to a persons age rather than income, and to have discretionary power over under 26 year olds remaining on parental healthcare plans.
Why should this policy be implemented?
Tax cuts on the Middle Classes will mean they have more money to spend. And if they do indeed spend it, this helps to foster economic growth, as has been demonstrated in the past few decades. Applied to a national level, this could likewise assist in economic growth, and would endear Mr Walker to those with a more moderate income.
Why not?
Mr Walker has cut hundreds of millions of dollars from public education funds, from Kindergarten to university level, which will deprive already struggling schools. The measures have also seen fit to remove much standardised testing. It does not take much to realise that well educated people generally have a greater likelihood of prospering in life and contributing to society and the economy. This approach as president could blight the future of millions of people, hardly what is needed for economic growth. His healthcare policy is also cause for concern. Mr Walker’s plan to repeal Obamacare would be an extremely brash move. The President’s signature bill has seemingly resulted in record low uninsured rates, and with nothing significant proposed to replace it, repeal will deprive millions of health coverage without offering any kind of remedy.
Hilary Clinton (D) – Former New York Senator and Secretary of State
The Policies
Mrs Clinton’s approach to tax is in some respects, the opposite of what the Republican candidates propose to do. In contrast to Mr Trump’s proposal to reduce capital gains tax, Mrs Clinton seeks to impose a hefty increase on assets that are under six years old. The drive behind this is to encourage investment. She also plans to cut taxes on small businesses and the class, and increase the minimum wage. On healthcare, the only thing that can be gleaned is her tacit support of Obamacare, and that she plans to strengthen it, and reduce healthcare costs overall. In contrast to Mr Walker’s attitude, Mrs Clinton plans to increase funding in education and ensure that higher education is more affordable, and that job training is more accessible.
Why should this policy be implemented?
The improvement of education prospects would greatly benefit those who are not as well off, and so long as it is implemented well, would provide and output of millions of well educated and trained individuals. Mrs Clinton rightly sees value in having an educated populace. Something other nations have benefitted from, especially in Asia, where education is highly prized. The pay off from this plan would likely not emerge for some time, but it represents a distinct foresight by Mrs Clinton. Her aim to improve the health of the nation through reducing healthcare costs would work in tandem with better education. A healthy population can only be a good thing, combined with good schooling is not going to be of detriment to the nation.
Why not?
Whilst her website lists numerous proposals, of which a few have been discussed here. They appear to be little more than bullet points on a slideshow, and there is no indication so far as to whether these policies will be affordable, with no statistics or any economic reports to support her cause. To put it bluntly, it looks as though she has cobbled together popular ideas to appeal to a broad range of people in order to get elected.
Bernie Sanders (D) Independent Vermont Senator
Mr Sanders presents himself as significantly to the left of the American political mainstream, and is a self-described socialist, with economic policies that are more mainstream in contemporary Europe, particularly Scandinavia. He plans to enact extensive tax reform, with a central ethos of targeting large corporations who do not pay income tax on profits, and horde large sums of money offshore in order to avoid said tax. In line with making large earners contribute more, he hopes too to raise the minimum wage from the current $7.25 per hour, regarding it as a “starvation wage.” He also takes a similar stance with Mrs Clinton by aiming to make education affordable on all levels. His most radical proposal though, pertains to healthcare. Not content with simply expanding Obamacare as Mrs Clinton has pledged, Mr Sanders would like to see the implementation of universal healthcare, considered a right in the rest of the industrialised world.
Why should this policy be implemented?
Mr Sanders proposals are at their core, populist and they are policies that are the antithesis of the Republican platforms. But they are policies that could help millions of impoverished Americans by relieving them from poverty, poor education, and ill health. Like Mrs Clinton, he rightly sees an educated and healthy populace as being of great benefit rather than burdensome. The aim to provide healthcare coverage regardless of status is perhaps most admirable, for it is a right. One should not be denied it because of their inability to pay.
Why not?
Mr Sanders’ pledges suffer from much the same drawbacks as Mrs Clinton’s. They have not been costed. It is admirable that he wishes to help large numbers of the populace, but with no studies to support whether his plans can realistically be paid for, they will remain little more than populist slogans. The other major drawback would be to get many of his policies past a republican controlled Congress, many of which are anathema to their conservative positions.
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