Economists on How Trump’s 2017 Tax Cuts Actually Played Out | WSJ

by Rod Williams, March 29, 2025- I generally favor tax cuts. For one, I want smaller government and cutting taxes can be a means of "starving the beast."  Also, sometimes tax cuts actually generate more revenue, not less. In order for me to support a tax cut, unless it "pays for itself" by generating more revenue, then I support a tax cut if the tax cut has a corresponding cut in government expenditure. I do not support tax cuts that simply lead to more government borrowing. 

This video examines the 2017 tax cut and finds that it did not live up to its promise. It missed the mark by a mile. For instance, the tax cut was promised to result in greater investment and to pay for itself by generating additional revenue. That did not happen. 

A promise of the tax cuts was that it would give average households an income boost of between $4,000 and $9,000. In reality the average household got a boost of only $750 per working person. Other provisions failed to live up to the promise. In reality, the 2017 tax cuts mostly benefited the top 1% of taxpayers. 

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Vanderbilt University Medical Center to cut $250M from research budget

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Federal budget cut sparks concerns with Nashville nonprofit organizations

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President Trump's budget cuts spark financial chaos for Nashville.

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Analysis of CBO's March 2025 Long-Term Budget Outlook: We are screwed!

 

From Committe for a Responsible Federal Budget, March 27, 2025 -Today, the Congressional Budget Office (CBO) released its March 2025 Long-Term Budget Outlook, which builds off its January 2025 ten-year projections to show that the federal budget is on an unsustainable path. The long-term outlook shows: Debt Will Surge Past Record Levels. Federal debt held by the public will rise from 100 percent of Gross Domestic Product (GDP) in Fiscal Year (FY) 2025 to 156 percent of GDP by 2055 – 50 percentage points above the prior record. Deficits Will Rise Even Higher. Annual deficits will grow from 6.2 percent of GDP in 2025 – already twice as high as they were as recently as 2016 – to 7.3 percent of GDP by 2055. This is the highest they’ve ever been outside of a crisis. Spending Will Continue to Outpace Revenue. Spending has already risen from 20.7 to 23.3 percent of GDP since 2016 and is projected to further increase to 26.6 percent of GDP by 2055. Revenue is projected to grow from 17.1 percent of GDP in 2025 to 18.2 percent in 2027 as the Tax Cuts and Jobs Act expires, then increase gradually to 19.3 percent of GDP in 2055. Historically, revenue has averaged 17.3 percent of GDP and spending 21.1 percent of GDP. Interest Costs Will Explode. Interest costs will reach a record 3.2 percent of GDP this year – exceeding the cost of defense and Medicare – and further grow to 5.4 percent of GDP by 2055. The average interest rate on debt will exceed the economic growth rate by 2045, sparking the beginning of a debt spiral. Social Security is Only Eight Years from Insolvency. The Social Security Old-Age and Survivors Insurance trust fund will run out of reserves by 2033 – when today’s youngest retirees turn 70 – leading to an immediate 24 percent benefit cut under the law. If combined with the disability insurance trust fund, the combined trust fund would be insolvent by 2034. Improvements from Last Year are Likely to be Swamped by Further Borrowing. Debt-to-GDP projections for 2054 are 12 percentage points lower than projected in last year’s extended baseline – due largely to lower projected interest spending as well as higher projected revenue. However, extending expiring tax cuts would add nearly 50 percent of GDP to debt. High and rising debt and deficits would have many negative consequences for the budget and the economy including slower income growth, higher interest rates and interest payments on the national debt, increased geopolitical risks, undue burden on future generations, reduced fiscal space to respond to emergencies, and an increased risk of a fiscal crisis. Debt Will Surge Past Record Levels  Under its current law extended baseline, CBO projects that federal debt held by the public will rise from 100 percent of GDP at the end of FY 2025 to a record 107 percent of GDP by 2029 and 156 percent of GDP by the end of 2055. Projected debt in 2055 will be nearly double the pre-pandemic level as a share of the economy and more than triple the 50-year historical average of 50 percent of GDP. In nominal dollars, debt will grow by $108 trillion, from $30 trillion at the end of this year to $138 trillion by the end of 2055.

CBO’s long-term projections are incredibly troubling, but reality could prove even more unsustainable. If policymakers extend provisions in the 2017 Tax Cuts and Jobs Act (TCJA), it could boost debt by $40 trillion over 30 years, to above 200 percent of GDP. Other changes could boost debt further. Such high and rising debt comes with a number of significant risks and threats to the budget and economy and could have severe consequences. CBO specifically notes that rising debt could slow income and output growth by crowding out investment and moving returns abroad. This leaves the United States more vulnerable to rising interest rates, constrains responses to economic and national security threats, erodes confidence in the dollar as the world reserve currency, and increases the risk of an eventual fiscal crisis.   Deficits Will Rise Further  The United States has gone from running a balanced budget in FY 2001 to borrowing an average of 2.4 percent of GDP through 2008, over 3 percent of GDP by 2016, and an estimated 6.2 percent of GDP in 2025. CBO projects deficits will further rise to 7.3 percent of GDP by 2055, which is well above the 50-year historical average of 3.7 percent and will be higher than any time in modern history outside of World War II, the Great Recession, and the COVID-19 pandemic.

In nominal dollars, budget deficits – which have already risen from $442 billion in 2015 to a projected $1.9 trillion in 2025 – will rise to $2.5 trillion by 2035 and $6.4 trillion by 2055.  Interest costs in particular have risen dramatically in recent years and are projected to explode. Due to a combination of high debt and rising interest rates, interest costs have doubled as a share of GDP from 1.6 of GDP in 2020 to a record 3.2 percent projected for 2025. The federal government now spends more on interest than defense or Medicare. CBO projects interest costs will continue to rise to new records of 4.1 percent of GDP by 2035, 4.6 percent in 2045, and 5.4 percent in 2055 – triple what it was pre-pandemic. Under CBO’s long-term outlook, the average interest rate will exceed economic growth (R>G) by 2045, and by 2055 interest costs will consume 28 percent of total revenue collection. With TCJA extension, deficits and interest would rise much more rapidly. We roughly estimate that deficits would rise to 11 percent of GDP by 2055, with interest costs approaching 8 percent. Spending Growth Will Continue to Outpace Revenue Rising deficits and debt are driven by a continued disconnect between spending and revenue. Spending has already grown from 20.7 percent of GDP in FY 2016 to 23.3 percent of GDP in 2025; CBO projects it will further rise to 24.4 percent of GDP by 2035 and 26.6 percent of GDP by 2055. Assuming the TCJA expires, revenue as a share of the economy will rise from 17.1 percent of GDP in 2025 to 18.2 percent in 2027, 18.9 percent by 2045, and 19.3 percent of GDP by 2055. Over the last 50 years, spending has averaged 21.1 percent of GDP and revenue 17.3 percent of GDP.

The projected long-term growth in spending is mostly driven by rising health, Social Security and net interest costs. CBO expects spending on these three areas to grow from 14.2 percent of GDP in FY 2025 to 19.6 percent by 2055. In particular, health care spending will grow from 5.8 to 8.1 percent of GDP, Social Security from 5.2 to 6.1 percent, and interest from 3.2 to 5.4 percent.

Social Security Is On the Verge of Insolvency Social Security – the nation’s largest retirement program and the government’s largest spending program – is only eight years from insolvency, according to CBO projections. Specifically, CBO finds that the Social Security Old-Age and Survivors Insurance (OASI) trust fund will run out by FY 2033, when today’s 59-year-olds reach the normal retirement age and today’s youngest retirees turn 70. Upon insolvency, Social Security retirees will face a 24 percent across-the-board benefit reduction, growing to 28 percent by 2055. We previously estimated that a 21 percent cut for a typical couple retiring in 2033 would equate to a lifetime deduction of $16,500. We could then expect a 24 percent cut to be approximately $18,900. The Social Security Disability Insurance (SSDI) trust fund is in better shape and projected to remain solvent through at least 2055. Using its surpluses to shore up the OASI trust fund would only extend solvency through 2034 and beneficiaries would face a 21 percent cut upon insolvency, growing to 26 percent by 2055.

In addition to Social Security, at least two other trust funds are headed for insolvency – the Highway Trust Fund by 2028 and the Medicare Hospital Insurance trust fund by 2052. The Medicare outlook has improved significantly thanks to a combination of lower projected costs and higher revenue projections. These projections are highly sensitive to economic conditions and health care cost growth, and the insolvency date could arise much sooner than projected. Improvements from Last Year Leave the Outlook Unsustainable CBO’s latest projections are an improvement from their March 2024 Long-Term Outlook. Debt is now projected to total 154 percent of GDP in 2054, compared to 166 percent of GDP in CBO’s prior outlook; CBO projects deficits to total 7.2 percent of GDP in 2054, compared to 8.5 percent previously. These modest improvements will likely be erased several times over by further borrowing, as extending expiring tax cuts would add nearly 50 percent of GDP to the debt.

Lower deficits and debt projections appear to be driven in part by higher revenue – mainly due to higher assets values, including in tax-deferred retirement accounts – and, more significantly, lower projected interest costs. By 2054, CBO projects interest costs to be 5.3 percent of GDP, compared to their previous projections of 6.3 percent of GDP. These lower costs are primarily the result of lower projected interest rates, as CBO now projects the ten-year yield to reach 3.8 percent by 2054 as opposed to 4.4 percent. These lower rates may be the result of lower assumed “crowd out” effects of higher debt and the two-way interaction between interest rates and debt.

Conclusion CBO’s latest long-term budget outlook reminds us that the federal budget is on an unsustainable long-term path, and policymakers will be faced with decisions this year that will have major implications for the trajectory of our debt over the next 30 years. Under current law, CBO projects that federal debt held by the public will rise from 100 percent of GDP at the end of this fiscal year to 156 percent of GDP by the end of 2055 – nearly twice the pre-pandemic level and three times the historical average. Extending the Tax Cuts and Jobs Act without offsets would drive debt above 200 percent of GDP – about four times the historic average. Even without this additional borrowing, the annual budget deficit will reach 7.3 percent of GDP in FY 2055 – higher than at any point outside of World War II, the Great Recession, and the COVID-19 pandemic. Interest costs will also explode, reaching a record 5.4 percent of GDP by 2055 and consuming 28 percent of revenue. And the Social Security Old-Age and Survivors Insurance trust fund will be insolvent by 2033 – in only eight years – at which point benefits will be cut by 24 percent across the board. Ultimately, high debt and deficits carry significant risks and threats to the economy and the nation. They hinder economic growth by crowding out investments, pushing up interest rates, straining the federal budget through rising interest payments, creating geopolitical challenges and risks, making the response to new emergencies more challenging, imposing burdens on future generations, and increasing the risk of a fiscal crisis. To address the nation’s long-term budgetary challenges, policymakers should restore solvency to Social Security and other trust funds, lower health care costs, reduce spending, cut tax breaks and raise revenue, promote stronger economic growth, and offset any new initiatives. They should not add further to the debt by enacting or extending tax cuts and spending without offsets. Doing so could spark a debt spiral and impose significant costs on current and future generations. Rod's Comment: Even the above bad news may be much worse if President Trump follows through on his stated policies. Reducing the tax on tips, overtime, and Social Security could reduce government revenue. However, putting this additional money in people's pocket could have a stimulus effect as people have more money to spend. However, the stimulus effect not cancel out the lost revenue.  The Trump tariff policies will likely contribute to inflation as things we buy will cost more. Also, as countries retaliate, America will likely export less, resulting in less GDP. Also, now when countries have a trade surplus with the US, a lot of the dollars they accumulate are used to purchase U.S. debt. If foreign government have fewer dollars to purchase American debt, the interest cost of America's debt will likely rise. We are screwed!

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Deadline to freeze Nashville property taxes approaching

Office of the Metropolitan Trustee, Nashville, March 27, 2025- Members currently enrolled in the Property Tax Freeze and/or Property Tax Relief program(s) must submit their vouchers every year by April 5 to stay enrolled in the program(s).

The tax freeze program was approved by Tennessee voters in a November, 2006 constitutional amendment referendum. The Tax Freeze Act of 2007 permits local governments to implement the program, and Metropolitan Nashville-Davidson County became the first jurisdiction in the state to establish a tax freeze program.

Under the program, qualifying homeowners age 65 and older can "freeze" the tax due on their property at the amount for the year they qualify, even if tax rates increase. Homeowners must have been 65 by December 31 of the tax year for which they are applying. Applicants must present:

• Proof of age - birth certificate, Medicare card, driver's license, passport, etc.;
• Proof of ownership - current tax bill or receipt, recorded deed, etc.;
• Evidence property is principal residence - voter registration card, etc.

Further, income records must be provided showing the total incomes of all property owners and applicant’s spouse during 2023 does not exceed $60,000 for Davidson County. Income records include Federal tax returns with all back-up documentation, or other income documents, such as a 1099 and a bank statement, if no tax return is filed. All applicants must sign an income verification form permitting the Trustee to contact IRS, SSA or the State Division of Property Assessment to verify income. The application is a public record, but the financial documents remain confidential.

Our office begins accepting applications to freeze taxes at the current amount due every October, and the deadline to apply for Tax Freeze is the following April 5. New applicants must come to our office, but no appointment is required. Bring the required documents to the Office of the Trustee and please arrive by 3:00 p.m. If you need additional information concerning the program, please feel free to call us with any questions at 615-862-6330.

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Trump is abusing his power. Is this a 'constitutional crisis' or something more? | Opinion

Elected leaders should never pretend that the president has more power than he is granted by the U.S. Constitution.

by David Plazas, Nashville Tennessean, March 25, 2025- In the last couple of weeks, President Donald Trump's rapid-fire executive orders have led legal experts to say his actions either have caused or are edging toward a "constitutional crisis."

Frankly, I don’t know what that term means anymore, given the confusion over whether we are in it or about to be in it.

So, over the weekend, I opened up my pocket U.S. Constitution and read it to try to find some clarity.

... My conclusion is this: What we’re seeing is a gross overreach of the executive branch of government that must be reversed and contained.

Yes, Article II grants the president tremendous amounts of power, but Article II, Section 1 (8) says: "Before he enter on the Execution of his Office, he shall take the following Oath or Affirmation: − "I do solemnly swear (of affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States."

The president is a public servant, not a king. His powers are limited by design.

... The three branches of government − legislative, executive and judicial − are co-equal and meant to check and balance each other. (Read it all)

Rod's Comment: I agree. Plazas offers examples. He should have also mentioned the "take care" provision of the Constitution. A budget passed by Congress and signed by the President is a law. The president has no authority to ignore it. There are several things the President is trying to do that I actually agree with, but they should be done legally. 

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How DOGE is making government almost comically inefficient

by Catherine Rampell, Washington Post, March 21, 2025-A senior aide to President Donald Trump once said the administration hoped to traumatize civil servants, an objective it has handily accomplished through arbitrary layoffs and other indignities. But government workers are not the only victims. Taxpayer dollars are being abused, too, as the “Department of Government Efficiency” makes the federal government almost comically inefficient.

... At the Bureau of Land Management, federal surveyors are no longer permitted to buy replacement equipment. So, when a shovel breaks at a field site, they can’t just drive to the nearest town or hardware store. Instead, work stops as employees track down one of the few managers nationwide authorized to file an official procurement form and order new parts.

... At the Food and Drug Administration, leadership canceled the agency’s subscription to LexisNexis, an online reference tool that employees need to conduct regulatory research. Some workers might not have noticed this loss yet, however, because the agency’s incompetently planned return-to-office order this week left them too busy hunting for insufficient parking and toilet paper. (Multiple bathrooms have run out of bath tissue, employees report.)

... Routine tasks take longer to complete, grinding down worker productivity. DOGE is also bogging down employees with meaningless busywork, which sets them up to be punished for neglecting their actual duties.

... What counts as DEI wrongthink also changes almost daily, meaning employees must perform the same word-cleansing tasks repeatedly. ... Another Kafkaesque executive order requires agency heads to send the White House a list, within 60 days, of their agency’s “unconstitutional regulations” — the ultimate “When did you stop beating your wife?”-style directive. ... Credit cards used for routine purchases have been canceled or had their limits shrunk to $1. ... there are costs to, say, not feeding the Transportation Security Administration’s bomb-sniffing dogs. ... These new directives are not only wasting government manpower and taxpayer dollars. They’re also resulting in worse services for Americans. .. The IRS, meanwhile, is deleting all non-English forms and notices, employees were told this week. This will mean less taxpayer compliance and more work for employees. (read more)

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Questions about congressman Andy Ogles' campaign spending: mysterious companies, bogus addresses

 Among our findings: money shelled out by U.S. Rep. Andy Ogles' campaign to companies for which there is no evidence they actually exist. Ogles' office blames "third-party software."

by Phil Williams, News Channel 5, March 24, 2025 -  An exclusive NewsChannel 5 investigation has uncovered new questions about a Middle Tennessee congressman who has left a trail of scandal since his election in 2022.

Over the last two years, NewsChannel 5 Investigates has revealed how Ogles fabricated large parts of his resume, including his professional credentials. ... about how he used the stillborn death of a child to raise thousands of dollars for a children's burial garden that was never built. ... how he did not appear to have the $320,000 he claimed to have personally loaned his own campaign back in 2022. 

Among the questionable expenditures, Ogles reported more than $14,000 spent in 2022 and 2024 with a company called “JL Tech Sales.” But when NewsChannel 5 Investigates searched that address in Chattanooga, we found a company there called Technology Sales.

Its exterior sign describes its services as “plexiglass, nylon, Teflon.” Its website said it is in the business of producing “industrial and mechanical plastics.”

There was nothing about office supplies, nothing about TV or Internet services.

Eventually, NewsChannel 5 reached the company at that address — and the person who answered the phone insisted they knew nothing about Andy Ogles or JL Tech Sales.

"And there’s never been another company by that name at this address – in the last couple of years?" we followed up.

"No, this business has been here 25 or 30 years – same business,” the man answered. (read more about how Ogles made up companies and fabricated expenditures)

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David French to teach "The Foundations of Free Speech" at David Lipscomb this Spring

Update: March 9, 2025- I have just registered for this class. This is a great opportunity to learn something from a great teacher and an experienced and accomplished person who knows his subject.

by Rod Williams, Jan. 28, 2025- Last year I took a one-day-a-week, multi-week, non-credit course at David Lipscomb University taught by David French on the Constitution. The title of the course was The American Foundings. The course primarily debt with the post-civil war 13th, 14th, and15th amendments and how these changes restructured our national governance and changed the nature of federalism.

David French

The course was informative, stimulating and thought-provoking. David French is an excellent teacher. He is returning with another course this year, which I plan to take. The course description is below. This course is part of David Lipscomb's Lifelong Learning program. 

David French is an opinion columnist for the New York Times. He was previously a staff writer for National Review. He writes about law, culture, religion and armed conflict. He often appears on The Bulwark podcast and on various news panel discussions. He is a veteran of Operation Iraqi Freedom and a former constitutional litigator who has litigated numerous cases involving religious liberty. He is a visiting professor at David Lipscomb University and is a resident of Franklin, Tennessee. 

For more information and registration, follow this link. 

 

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