Happy Thursday! The NFL season is here, and the Kansas City Chiefs will kick off their quest for a three-peat tonight against the Baltimore Ravens. But we’re focused on Harris vs. Trump, not Mahomes vs. Jackson. With Election Day exactly two months away, former President Donald Trump made some news in an address to the Economic Club of New York. Vice President Kamala Harris traveled to Pittsburgh, where she will spend the coming days preparing for Tuesday’s presidential debate. Here’s what you should know.
Trump Pitches Wall Street on Tariffs, Tax Cuts and Elon Musk
In a speech to the Economic Club of New York, former President Donald Trump on Thursday promised to create a government efficiency commission if he’s elected to another term, embracing an idea proposed to him by billionaire Elon Musk. Trump said Musk would lead the panel, which would be “tasked with conducting a complete financial and performance audit of the entire federal government and making recommendations for drastic reforms” that would cut waste, fraud and abuse.
“We need to do it. Can’t go on the way we are now,” the Republican presidential nominee said, drawing applause from the audience, which included Wall Street titans, business and economic leaders and former members of the Trump administration.
Trump claimed the commission’s first order of business would be to develop an action plan to “totally eliminate fraud and improper payments within six months,” which he said would save “trillions of dollars.”
His meandering remarks were littered with a series of false, misleading and sometimes baffling comments along with lofty promises. He again attacked Vice President Kamala Harris as a “radical” and a “Marxist,” and he again painted a dark picture of current and future conditions in the country under Democratic leadership. He called the United States a nation in decline with an economy in crisis. He warned that migrants are “taking the jobs of Hispanic Americans, African Americans.”
As he described his economic agenda, Trump promised to rescind unspent funds approved as part of Democrats’ Inflation Reduction Act, eliminate 10 old regulations for every new regulation enacted, create a U.S. sovereign wealth fund and make America the world capital for cryptocurrency and Bitcoin. He again pledged he would significantly ramp up energy production, which has reached all-time highs under the Biden administration. Trump said it would be “four times higher” if he were in office. He said he would drive down housing costs, and ban mortgages and taxpayer-funded benefits for migrants in the country illegally.
And he repeated his calls for sharply higher protectionist tariffs, which he said would boost domestic production, lower inflation and reduce the deficit.
“We will create the biggest, greatest and strongest middle class in the history of our country,” Trump said. “Some might say it’s economic nationalism. I call it common sense. I call it America First.”
Economists have warned such tariffs would drive up inflation, disproportionately hurting lower-and middle-income consumers and could hurt economic growth.
The former president also said he would make his 2017 tax cuts permanent, which the Congressional Budget Office has said would cost $4.6 trillion over a decade. He said he would lower taxes further, repeating his pledge to eliminate taxes on tips and on Social Security benefits. Trump said he would cut the corporate tax rate, which had been 35% prior to his 2017 tax law, from the current 21% to 15%, though he said companies would have to make their products in the United States to be eligible for the reduced rate. Harris has proposed a 28% corporate tax rate.
Trump also claimed that his administration had proved that targeted tax cuts reduce the deficit, which most economists and analysts vigorously dispute. Trump’s 2017 tax cuts increased the national debt.
Asked after his speech what he would do and what specific legislation he would advance to make childcare affordable, Trump fumbled through an answer in which he suggested that the revenue he would generate through his tariffs and economic growth would be enough to finance childcare and much, much more. “I look forward to having no deficits within a fairly short period of time, coupled with the reductions that I told you about on waste and fraud and all of the other things that are going on in our country,” he said.
The Tax Policy Center recently projected that Trump’s tariffs would generate about $2.8 trillion in net revenue over a decade, which would be far short of wiping out federal deficits that now run about $2 trillion a year. But the audience at the Economic Club of New York gave Trump another round of applause for his response.
Quotes of the Day
“We’re going to get gasoline below $2 a gallon.”
— Former President Donald Trump, in an address on the economy delivered Thursday at the Economic Club of New York. As CNN notes, Trump vowed to “end Kamala Harris’ anti-energy crusade,” despite the fact that the U.S. is producing more oil now than it has at any point in history, including during the Trump administration.
“Think about Covid. That’s the type of situation you would need to get gasoline under $2. You would need a significant economic downturn across the world – including in the US – that substantially and negatively impacts demand. You’d need oil at $40.”
— Andy Lipow, president of consulting firm Lipow Oil Associates, speaking to CNN about Trump’s comments. Lipow pointed out that the low oil prices seen during the Trump administration occurred directly as a result of the Covid-19 crisis. “I don’t think anyone wants to return to those pandemic times,” Lipow said.
Johnson Plan on Spending Bill Draws Doubts
House Speaker Mike Johnson is reportedly planning a showdown with Senate Democrats over a spending bill that’s needed to keep the government open and fully functioning once the new fiscal year starts on October 1. Embracing a demand from the far-right Freedom Caucus, Johnson plans to bring up a continuing resolution, or CR, that will fund the government through March 2025, with amendments that include the Safeguard American Voter Eligibility (SAVE) Act, a bill backed by former President Donald Trump that would require proof of citizenship to register to vote.
That would set the House bill on a collision course with Senate Democrats.
As The Hill’s Emily Brooks and Mychael Schnell report, the dynamic is a familiar one, as Johnson seeks to please his most conservative supporters while trying to pass a bill that requires cooperation from Democrats. The result, some Republicans fear, will be familiar, too, with Johnson abandoning his approach after it fails.
One GOP member of the House described Johnson’s plan as “fruitless,” even as the lawmaker pledged support. “We all know the only thing that will get through is a clean CR! Other than that it’s shut down city!” the member said.
A handful of GOP lawmakers have said they would oppose the bill, with Rep. Nick LaLota of New York asking Johnson to submit a “clean” CR. LaLota, whose district was won by President Joe Biden in 2020, warned that if the funding showdown leads to a government shutdown next month, as many as 10 Republicans could be at risk of losing their House seats.
Johnson reportedly plans to plow ahead, arguing that you can’t know if an effort will fail until you try it. But some lawmakers say it’s pretty clear that a clean CR will be the final outcome. Indiana Republican Rep. Larry Buschon said he doesn’t think it makes sense to shut the government over a questionable amendment. “You realize the federal law already says that … you have to be a citizen to vote. So, from my perspective, I hope it doesn’t hold up the funding,” he told Politico. “I think that ultimately we will … pass a clean CR into early December.”
Fiscal News Roundup
- Speaker Johnson’s Opening Salvo on Spending Draws GOP Doubts – The Hill
- Trump Proposes 15% Tax Rate for Some Companies and a Role for Elon Musk in Government – Wall Street Journal
- Trump Backs Plan That Would Give Elon Musk Broad Role in U.S. Policymaking – Washington Post
- Trump’s Wall Street Pitch: Punishing Tariffs, Low Taxes, ‘Explosive’ Growth – Politico
- Raise Taxes on the Rich or Cut Them? Harris and Trump Differ on How to Boost US Economy – Associated Press
- Harris’ Attempt to Separate Herself From Biden on the Economy Frustrates Trump – CNN
- Republican-Led States File New Lawsuit to Block Biden’s Student Loan Forgiveness Plans – CNN
- Republican Liz Cheney Endorses Kamala Harris – Associated Press
- FDA Has Massive Backlog of Factory Inspections as Staffers Leave for Private Sector Jobs – Associated Press
- Atlantic City’s Top Casino Underpaid Its Online Gambling Taxes by $1.1M, Regulators Say – Associated Press
- Republicans Set Stage for State Challenges if Trump Loses Election – Associated Press
- Right-Wing Influencers Were Duped to Work for Covert Russian Operation, US Says – Associated Press
- How Biden Is Spending His Final Months as President – NBC News
Views and Analysis
- Democrats May Get Their Chance to Soak the Rich – Timothy Noah, New Republic
- What Harris’ Plan to Tax Unrealized Investment Gains Means for the Wealthiest Americans – Kate Dore, CNBC
- Kamala Harris Is Not Here to Fix Income Inequality – Kevin T. Dugan, New York
- Goldman Sachs Says Comrade Kamala Is Better for Economy. She Can't Even Do Communism Right! – Rex Huppke, USA Today
- Small Businesses Aren’t Asking for Tax Cuts – David Dayen
- Elon Musk Is an Anti-Harris Misinformation Machine—but a Laughable One – Alex Shephard, New Republic
- Hospital Looter Says ‘Nah’ to His Senate Subpoena – Maureen Tkacik, American Prospect