Yahoo Finance The Possible Economic Ups and Downs for the Middle Class If Trump Is Elected
The 2024 election is quickly approaching. After four years of President Joe Biden, Nov. 5 will decide whether he serves another term or whether former President Donald Trump returns to the White House.
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Each of these choices could have a huge impact on their cost of living, particularly for the middle class. Wondering whether you’re in America’s middle class? Per Pew Research Center, the middle class has a household income between $39,693 and $119,080.
If you fall in that range, here is what economists and political experts say you can expect if Trump wins the election.
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Potentially Lower Taxes
When Trump was president, he passed the Tax Cuts and Jobs Act (TCJA). If Trump is reelected, Republicans would work to extend the TCJA tax cuts, some of which expire in 2025.
Chuck Warren, host of The Breaking Battlegrounds Politics Podcast, said this could impact what the middle class pays come tax season. “[This extension might] also include further personal and corporate tax rate reductions.”
Warren said time will tell whether the middle class actually experiences the advantages of the tax cuts. “Although these cuts may increase disposable income for some working-class families, there is controversy over whether all the benefits would be shared equally across the entire middle class.”
Higher Healthcare Costs
During Trump’s term as president, he worked hard to try to repeal the Affordable Care Act (ACA). At the end of 2023, Trump was still passionate about this issue, posting on social media, “I don’t want to terminate Obamacare, I want to replace it with much better healthcare.”
If he’s reelected and successful in repealing ACA, Warren said, “This could result in different healthcare policies affecting middle-class households, thereby leading to higher out-of-pocket healthcare expenses if pre-existing condition protections and subsidies are rolled back.”
Change in Medicare and Social Security
The future of retirement programs is a major issue in this election.
“Economists point out that Trump may pursue changes affecting benefits received by middle-class retirees, concerning future funding needs,” Warren said.
During his presidency, Trump proposed spending cuts for Social Security and reductions to provider payments on costs covered by Medicare.
Conversely, on his 2024 campaign trail, Trump and his campaign have said he won’t make cuts to those programs. In a campaign video, he said, “Under no circumstances should Republicans vote to cut a single penny from Medicare or Social Security.”
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Higher Costs of Goods
Trump levied large tariffs against China during his presidency and has said he would double down if elected again. He has suggested he would impose a 10% tariff on imports and a 60% tax on Chinese goods.
Landon Pyle, the VP of sales and marketing at R&S Logistics Inc., said this would hit middle-class consumers hard.
“Everything from furniture and household appliances to cars and computer parts relies on imports, and U.S. manufacturing is not positioned to meet the consumer demand,” Pyle said. “Instead, importers will likely raise prices to offset the tariffs, which will ultimately impact middle-class consumers.”
More Jobs
When Trump was campaigning to be president in 2016, he discussed a $1 trillion infrastructure plan that would work to fix highways, bridges, tunnels, airports, schools and hospitals in the United States. While there were some successes, the promised plan was criticized by some states and largely seen as a disappointment.
If Trump wins and follows through on infrastructure promises, it could mean big job growth, Warren said.
“Economists argue that if these projects were given priority then they would create many jobs,” he said, “especially benefiting those involved in construction and related areas — with the majority being from middle-class families.”
Increased Workforce Training
In 2018, Trump’s administration rolled out a five-year strategic plan for science, technology, engineering and math (STEM) education. The goal was to teach technical skills that people would need in high-tech workplaces.
If we have another Trump presidency, Warren said he could continue to focus on these types of training programs, potentially giving more earning power to Americans.
Warren said, “These endeavors might equip the middle class with additional skills and more good-paying jobs, especially in scientific and mechanical areas.”
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