Who will benefit from Tax reform

WINNERS FROM TRUMP FISCAL POLICY

GOVERNMENT EMPLOYEE PENSIONERS MAY BE BIGGEST WINNERS

While the new tax reform bill is not yet complete or passed it seems it will happen soon. Some are disappointed that they will not receive a substantial tax cut. Some complain that business and corporations are the big winners. At first glance that may appear to be the case, but in the long run all Americans will benefit from Trumps proposals. The tax bill is not exactly what Trump wanted, but in a representative democracy we don't always get what we want. 

First of all, the biggest winners in the long run may be government workers pension plans. Many were on the verge of insolvency, particularly in big union blue states.With the run-up in stock prices, since Trumps election and the anticipation of a friendly business climate, stocks have increased by over 30%. This may save these plans if they will also restrain increases in benefits.

With the lowering of the corporate income tax from 35 to 20% this will increase corporate profits and increase dividends which will also benefit these pension plans. 

It can be assumed that this more friendly business climate will stop the hemorrhaging of companies and jobs to other countries. It will also encourage international corporations to shift some business to the U.S. It will also save those who are struggling and encourage new business formation.

Those that fret that this plan will raise the debt by 1.5 Trillion over 10 years, are the same ones who said nothing of 8 Trillion in increased debt in 8 years under the last administration. 

They are not taking into account that increased dividends will add to taxes collected by the government, also increased capital gains will also add to taxes collected. Also increased activity will hopefully increase jobs and wages, which will also add to government revenue.

Finally an increase in business activity should result in more normal interest rates, which again should encourage savings and reward seniors who saved and were responsible with their money.

If there any losers in  these policies, it will be few, and adjustments can be made in the future to address those issues. Hopefully if these policies are successful, there could be future tax decreases for all.