Trump Is President: 3 Potential Economic Laws the Middle Class Should Look Forward to This Year
Written by
Kerra Bolton
Edited by
Zuri Anderson
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President Donald Trump wasted no time during his second term moving forward on the economic promises he made to boost the middle class.
While some economic policies indirectly help the middle class, such as deregulating businesses and imposing tariffs, Trump has advocated for eliminating federal income taxes on tips, overtime pay and Social Security benefits, which could increase take-home pay for many workers and retirees.
Now that Trump is president again, here are three potential economic laws the middle class should look forward to this year.
Targeted Tax Relief
President Trump promised to eliminate federal income taxes on tips, overtime and Social Security benefits. Here are examples of how Trump’s targeted tax relief could help the middle class:
- A food service worker reliant on tips for income could keep more of their money to cover rent, groceries or unexpected expenses without needing to take extra shifts.
- A nurse working overtime could have more money to save, reduce their debt or afford better childcare.
- A retired couple could save thousands of dollars per year to help cover medical costs, home repairs, or travel.
However, U.S. House Republicans are considering taxing employer-provided transportation benefits of up to $315 per month, including transit passes and parking, as more companies are requiring employees to return to the office to pay for the federal revenue lost from Trump’s other tax cuts.
“The big question becomes: ‘To what extent are the pro-growth and anti-growth policies implemented and how do they net out?'” said Wayne Winegarden, an economist at the Pacific Research Institute.
“The answer to this question will determine how the impacts that middle-class families will experience.”
Strengthening the American Workforce
While President Trump’s plans to impose tariffs on foreign goods have drawn criticism from some economists, some executives said Trump’s tariffs will help the middle class.
“Strengthening domestic infrastructure investment would boost demand for American-made steel, creating more jobs and stabilizing prices,” said Dale Crawford, the executive director at the Steel Tube Institute.
Crawford also said that President Trump’s enforcement of anti-dumping laws and trade agreements among the U.S., Canada and Mexico “would ensure that only high-quality steel enters the market, protecting manufacturers and consumers alike.”
In addition, Crawford said workforce development programs across several sectors could help expand the skilled labor pool needed for increased domestic production and create jobs.
Investing in American Companies
Within the first days of his second term, President Trump signed an executive order that eliminated 10 regulations for each new regulation issued.
“Overregulation stops American entrepreneurship, crushes small business, reduces consumer choice, discourages innovation, and infringes on the liberties of American citizens,” the Trump administration said in a White House statement. “It also contributes to the high cost of living, including by driving up energy prices.”
For the steel industry, Crawford said eliminating regulatory reforms that “reduce unnecessary red tape for steel producers and manufacturing could further enhance domestic manufacturing.
“Policies that encourage reshoring, such as tax incentives for companies investing in U.S. production facilities, would create long-term economic benefits.”
Winegarden said that while the Trump administration’s economic policies have downsides, they can also help the middle class.
“These policies will encourage a greater economic growth rate that will generate rising incomes that will help middle class families,” Winegarden said. “The rise in median household income during Trump’s first term demonstrates the benefits.”
Editor’s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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