Penn Wharton: Republican Tax Plan Would Do Almost Nothing to Boost GDP

The Penn Wharton Business Model has analyzed the Republican Tax plan and reports back that it will have the following effect on GDP:

What’s that? The chart is too small and you can’t see the difference? No worries: your eyes are fine. The problem is that there virtually is no difference. PWBM figures that by 2027 GDP would be .58 percent higher than it would be under current law. That’s a difference of .05 percent per year. And that’s with dynamic pixie dust included.

In other words, GDP growth over the past couple of decades has averaged about 2.3 percent per year. The Republican tax plan would increase that to…2.35 percent. This is not exactly the supercharged 3 percent economy Donald Trump promised us.

And it gets worse after 2027. Thanks to the $5 trillion in extra debt the tax cut generates, the economy would lose even this tiny amount of extra growth and maybe even grow slower than it would under current law. Between 2017 and 2040, the total net effect of the Republican plan is basically zero.

But a bunch of rich people would be a lot richer. Mission Accomplished!

BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things they don’t like—which is most things that are true.

No one gets to tell Mother Jones what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. Please help with a donation today if you can—even a few bucks will make a real difference. A monthly gift would be incredible.

payment methods

BEFORE YOU CLICK AWAY!

“Lying.” “Disgusting.” “Scum.” “Slime.” “Corrupt.” “Enemy of the people.” Donald Trump has always made clear what he thinks of journalists. And it’s plain now that his administration intends to do everything it can to stop journalists from reporting things they don’t like—which is most things that are true.

No one gets to tell Mother Jones what to publish or not publish, because no one owns our fiercely independent newsroom. But that also means we need to directly raise the resources it takes to keep our journalism alive. There’s only one way for that to happen, and it’s readers like you stepping up. Please help with a donation today if you can—even a few bucks will make a real difference. A monthly gift would be incredible.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate