Can someone tell me how much is the complete overall taxes alltogether in the USA for 1 year actually ? I heard it is $4 trillion or more ? Then you have around $36 trillion deficits, correct ? If Trump wants big tax cuts how he can finance that, because the deficits is going up at once and tariffs I am not sure if they can be collected in that level at once too. DOGE can be helpful but it also takes time. And what if you have a 5% interest rate it with $60 trillion USA deficit, a lot of money must be printed. With $4 trillion annual income, if this is correct, I do not understand how the shift from taxes to tariffs are actually working. And if the deficits grow too much, the solvency is in danger or at least it is very inflationary. Who can explain me that little bit more, as I cannot understand it really how does it work now actually ? I mean it is kind of process. And for the now he needs a full trade war with tariffs ?
It's so complex they don't even know what they are doing. Even this so called AI can't even figure it out. With all these billions poured into the ai hype by now you would think they could teach us how to eliminate the deficit...
FY 2024 tax revenues were approx. 4.9 trill. The tax cuts enacted in 2017 are set to expire this year. If that happens the average tax bill per family will go up about 22%. All the cutting is about lowering costs so the tax cut of 2017 could be made permanent without making the deficit worse. The tariffs seem to be targeted at the balance of trade deficit. When we have a deficit with another country money leaves the US and goes to the other country. The countries with the surplus tend to send the excess back to US as investments in equities, bonds, and real estate. If they didn't, the dollar would drop to equalize the imbalance. That would naturally make the cost of the other countries products and services rise and the trade balance would auto correct. Hope this basic explanation helps to understand a bit more about what is going on.
And to add to acrary's explanation... Trump's theory is that by keeping taxes low and adding more tax reductions - that more incentive will exist to work and start businesses - thus increasing tax revenue to far more than offset the cuts. More broadly this is known as the Laffer Curve, however reducing taxes only works to a certain point. The same applies to his theory about tariffs. The very simple and easy way to avoid tariffs is to build/produce here in the US. This creates more jobs, more income and more tax revenue for the US to reduce the deficit and potentially raises our GDP which is half the ratio used to determine if a country's debt is excessive or not. 36T is less of a burden if you have a much higher GDP. Having said that, DOGE is actually making the problem worse right now. Despite claims of tens of billions in "savings", several media organizations have reviewed the receipts and specifics and found actual savings of less than 10B. They are spending lots of time cutting the Federal workforce, the entirety of which is only paid 225B a year. Along with cutting contracts that are clearly wasteful, DOGE has also caused lots of meaningful and important efforts to be terminated and the downstream effects of firing hundreds of thousands of Feds and contractors suddenly will have significant ripple effects through the economy. I personally support much of what Trump is trying to accomplish here, however the manner in which he's doing it is altogether wrong. It's too fast and haphazard and some of the "mistakes" will be far more costly than the proposed savings. It's super risky. It could work beautifully, or we could be in a depression by Christmas.
Nobody is worried about the deficits. Meanwhile, problem can be fixed by getting more high-speed printers.
Im going with too fast and too haphazard. The ripple effect will be too hard to stop as we get further out.
As tariffs are implemented and effect changes, it would raise costs to Americans while lowering imports .... the money raised by these tariffs would likely drop at some point. In any case I don't see how (no friggen way to be honest) $5 trillion could be raised to cover tax cuts. As for your quoted average tax bill percentage 22% where does that come from? Average is sorta a meaningless term in this discussion anyway.
Just heard on BloombergTV (ya know fake news) that autos made in SKorea/Japan/Europe are tariffed between 2 and 10% roughly. So they now, for the {tRumpy} moment, will have a competitive advantage versus Canada and Mexico - which produces mostly U.S. brands. Auto makers represent 4% of GDP. Soon to be 0.4% Einstein must be having a good laugh at all this .......... insanity.