Many Americans had a positive economic experience during Donald Trump’s presidency. An April poll by the Associated Press-NORC Center for Public Affairs found that Americans believed Trump was better for the economy and that he had helped create jobs and the cost of living in the country.
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While this group includes boomers (those born between 1946 and 1964), the data shows that a second Trump term could be financially problematic for senior citizens.
Unfulfilled promises
The Trump administration didn’t quite deliver on what it promised. That includes ineffective tax cuts that favored corporations and the wealthy, plus tariffs and trade deals that failed to recover all the lost factory jobs, according to the Associated Press.
While Trump stated that the tax cuts would increase by 3%, he raised expectations further, saying the increase could reach between 4% and 6%. After all, the average increase after inflation was 2.67%. By contrast, annual growth under President Biden currently averages 3.4%.
Trump attributes lower inflation to his administration when evidence shows the pandemic is the cause of lower gas prices and mortgage rates stemming from a lack of driving and real estate purchases. While 6.7 million jobs were added during Trump’s tenure, Biden added 15.4 million (more than twice as many). If we look at manufacturing jobs alone, Trump brought in 461,000 while Biden added 773,000. Based on these numbers, Trump offered less of a jobs recovery, overreach, and underachieving deficit reduction, none of which benefit the boomers.
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No help for pensioners?
Trump has expressed a focus on higher tariffs, mass deportation of unauthorized immigrants and more corporate tax cuts. Trump and his campaign leaders have said he won’t cut Social Security and Medicare, but they’ve also talked about the waste around those programs. It remains to be seen what he can do to help Social Security’s solvency.
Low-income families and seniors could face challenges if shifts toward deregulation lead to reductions in welfare programs or changes to Medicare and Social Security, as has been debated, said David L. Blain, CFA, founder and CEO of BlueSky Wealth Advisors. . Such demographic groups typically rely more heavily on these types of government support structures, which may be altered or reduced.
As Colin Ruggiero, co-founder of DisabilityGuidance.org, GOBankingRates, said, doing nothing could also be detrimental to the program as a whole.
Impact of tax and tariff plans
Turning to the polls, Americans overwhelmingly believe Trump will be better for their finances and economy, according to CNN. But the evidence points to higher taxes for the bottom 80% of Americans as a result of Trumps tax and tariff plans, which does not bode well for young adults struggling to save.
Trump’s tariffs during his presidency reportedly resulted in $80 billion in added taxes for Americans. He plans to double the fees if he wins this year, meaning Americans could end up paying even more. The US-China Business Council predicts the US economy will shrink by $1.6 trillion over five years if Trump imposes tariffs.
inflation
Trump is said to be interested in reining in the Federal Reserve, but reducing the Fed’s political autonomy has historically resulted in higher inflation rates.
According to Harvard economist Jason Furman, if Trump undermined [the Feds] their independence and credibility, which he has proven to be very likely to try to do, which could make it very difficult to keep inflation under control.
A devaluation of the dollar and a shrinking labor force by reducing immigration may also contribute to higher inflation.
Andrew Lisa and John Csiszar contributed reporting for this article.
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This article originally appeared on GOBankingRates.com: 4 Reasons A Second Trump Term Could Be a Financial Disaster for Boomers
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