Trump and Biden, diametrically opposed visions of the US economy

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One wants to lower taxes, the other to increase them: the economic programs of Republican Donald Trump, hospitalized Friday having tested positive for Covid-19, and of Democrat Joe Biden, the two candidates for the American presidential election, are radically opposed.

Whoever wins this uncertain duel, he will need a majority in Congress to fully implement his economic policy.

If Joe Biden is elected on November 3, the richest Americans and big business will pay an additional $ 4 trillion in taxes over the next ten years.

These tax revenues, according to the platform of the Democratic candidate, will be reinvested in social programs and education, but also infrastructure, whose modernization is an old sea serpent in the United States.

“Households with low and moderate incomes will benefit more from Biden’s policy than from Trump’s,” underline Mark Zandi and Bernard Yaros, economists at Moody’s.

They argue that a second term for Donald Trump would perpetuate the tax cuts that mainly benefited big money and businesses during his first term.

Between invectives and names of birds, the first debate, on September 29, between the two septuagenarians did not allow to know much more about their respective economic programs.

Donald Trump claimed that his administration had “created the best economy in the history of the country”, predicting that if Joe Biden was elected, it would all fall apart.

Before the pandemic, all economic signals were green, the labor market was in its best shape for 50 years in particular.

Millionaires and billionaires

Joe Biden, who now presents himself as the candidate of the middle classes, explains that his rival’s policy mainly benefits the wealthy.

“Millionaires and billionaires like him are doing very well from the Covid-19 crisis,” insists the Democratic candidate, who says he wants to “build a greener economy”.

The energy transition should make it possible to create “millions of well-paid jobs”, according to its campaign site.

Joe Biden’s proposals “would provide the US economy with a boost as it recovers from the global coronavirus recession,” said Nancy Vanden Houten and Gregory Daco of Oxford Economics.

This is also the conclusion of economists at Moody’s, who believe that Joe Biden would be in the best position to revive the world’s largest economy.

According to their calculations, full employment, which disappeared with the Covid-19 crisis, could be back in the second half of 2022 with the Democrat, and only in the first half of 2024 with the Republican.

They also believe that if Joe Biden abandons the policies put in place by his opponent on foreign trade and immigration, this could give an additional boost to growth.

On the other hand, whoever wins, the future president will be hampered in his ambitions if he faces opposition in Congress.

Trump or Biden, the difference will then, in the end, be quite minimal, anticipate Mark Zandi and Bernard Yaros.

“Made in America”

While they castigate Mr. Trump’s economic policies, the unions do not embrace Mr. Biden’s either.

“If we are stuck with four more years of Trump, it will be very damaging for our country and for workers,” warns Carl Rosen, president of the EU union, which represents 35,000 workers from different industrial sectors.

His union does not support Joe Biden because he considers his measures too lukewarm.

The two candidates agree on one point: the promotion of “Made in America”, hammered by Donald Trump during his entire mandate.

They share a “skepticism about free trade,” said John Ricco, a professor at the University of Pennsylvania. “The tools to achieve this are not the same”.

More than 3,400 companies from all sectors, including Tesla, Home Depot and Ralph Lauren, have sued the Trump administration to denounce additional tariffs imposed on Chinese exports as part of the Sino-American trade war triggered by the billionaire.

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