Proposals Would Add $18 Trillion To Federal Debt, Nonpartisan Researchers Find
As the election cycle continues, 2016 presidential hopefuls are fleshing out their policy proposals in order to appeal to voters. A new study from the nonpartisan Urban-Brookings Tax Policy Center along with the Urban Institute Health Policy Center examined the taxation and spending proposals put forth by Democratic presidential hopeful Sen. Bernie Sanders (I-VT). The study, according to the AP, found that Sen. Sanders’ “tax and spending proposals would provide new levels of health and education benefits for American families, but they’d also blow an $18-trillion hole in federal deficits, piling on so much debt they would damage the economy.” Sanders has proposed to “raise taxes by more than $15 trillion over 10 years, with most of that paid by upper-income earners.” However, the study found that this tax hike wouldn’t be sufficient to cover the costs of his proposals, including a “government-run health care system, along with free undergraduate college, enhanced Social Security, family and medical leave, among other new programs.” Essentially, these new policies would increase the Federal debt by $18 trillion over 10 years, roughly doubling “the current total government debt of $19 trillion.” Diving further into the details of the report, the Washington Times reports that according to the analysis, Sanders’ “health and other spending plans would cost a whopping $33.3 trillion” over 10 years, while “his massive tax increases would still pay for less than half of it, leaving a gaping hole that would be a ‘substantial drag on the economy.’” In its analysis, the Tax Policy Center said, “The dramatic increase in government borrowing would crowd out private investment, raise interest rates, further increase government borrowing costs, and retard economic growth. In combination with the dramatically higher tax rates, which would reduce incentives to work, save, and invest, the negative macroeconomic effects of the plan could be severe.”
What This Means For Small Businesses
Though small business owners have differing views about who best represents the type of leadership America needs, this latest study may offer useful information about details of a presidential candidate’s fiscal policies. Whether any 2016 presidential candidates’ policy proposals will work to strengthen the economy for small businesses remains to be seen.
Note: this article is intended to keep small business owners up on the latest news. It is not meant as an endorsement of any candidate and does not necessarily represent the policy stances of NFIB.