Tuesday, July 7, 2015

Romney budget plan 'a drag' on US growth: TD Bank

Planned cuts in non-defense spending to pay for investors' tax cuts will slow the US economy, writes bank's economist

Romney budget plan 'a drag' on US growth: TD Bank

0 comments
Travel Deals

Watching the US presidential campaign from Toronto, Craig Alexander, chief economist at TD Bank, one of the biggest banks doing business in Philadelphia and other East Coast cities, writes that "the gulf between the two parties is mainly over taxes. Democrats favor increasing taxes on the wealthy (or at least letting past tax-cuts expire) and Republicans do not...

"If Obama is re-elected, in all likelihood, [expect] higher taxes on dividends and capital gains. His deficit reduction plan calls for $1 in revenue increases for every $2.50 in spending restraint.

"If Romney is elected, taxes are more likely to fall. Romney’s plan calls for a reduction in marginal tax rates and the elimination of capital gains and dividends taxes on income below $200,000, to be paid for by eliminating deductions...

"Romney’s platform calls for federal spending to fall from 24% of GDP to 20% of GDP by the end of his first term, while holding defense spending at 4% of GDP (thereby reversing the cuts that have been proposed by President Obama). 

"This will mean outright reductions in non-defense spending that will pose a drag on the pace of economic growth over the next four years...

"There are areas of agreement... There is a broad acceptance of the principles for tax reform... that removes loopholes and deductions from the tax code, and uses some of this revenue to lower tax rates... 

"Working with Congress will be the biggest challenge facing the next American President. The task is large, but so too is the payoff. Achieving consensus on a prudent fiscal plan would go a long way to boost confidence, improving the prospects for economic growth."

0 comments
We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy:

Philly.com comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by Philly.com staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
 
comments powered by Disqus
About this blog

PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, distefano251@gmail.com, 215.854.5194 or 302.652.2004.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
Also on Philly.com:
letter icon Newsletter