Clinton Tax Plan Will Kill Private Sector Jobs, Increase National Debt New NCPA Study Outlines Economic Impact
August 19, 2016
Presidential candidate Hillary Clinton’s tax plan would increase public sector jobs by 49,000 in 2017, but they would come at a cost of 207,000 private sector jobs, according to results from a new National Center for Policy Analysis study. In 2026, the public sector would gain 54,000 jobs but lose 265,000 private sector jobs.
“In essence, every government job created by Hillary Clinton would eventually cost nearly five private sector jobs,” said NCPA Senior Fellow Pamela Villarreal.
Villarreal notes the Clinton plan would create additional recessionary effects, including:
- In the first year, real GDP would be more than half a percent less than under the Congressional Budget Office's current baseline estimate, and almost 1 percent less in 2026.
- Personal income would be $47 billion less in 2017 alone; this loss would increase to $103 billion in 2026.
This analysis is based on results from the NCPA’s modeling of the U.S. economy for the NCPA’s Tax Analysis Center, in partnership with NCPA Senior Fellow Dr. David Tuerck and his team at the Beacon Hill Institute in Boston.
Said Tuerck, “What we have here is a plan to destroy hundreds of thousands of private sector jobs just to pad government payrolls, while, in the process, doing almost nothing to improve tax fairness. This is, at best, a redo of the failed Obama stimulus with the added feature of imposing a new drag on our recovery from a recession that ended seven years ago.”
According to the study, Clinton's plan would raise federal revenues $615 billion over 10 years compared to the CBO baseline estimate.
- The majority of this revenue increase would come from the personal income tax hikes on the rich, but Social Security payroll tax revenue would fall $47 billion over 10 years due to fewer people working.
- Hillary's plan to cut subsidies for oil and gas development would increase corporate tax revenues $43 billion over 10 years.
However, the restraint on economic growth would result in a fall in state and local tax revenues.
While this analysis does not address Hillary Clinton's spending plan, several sources estimate that her promise of new spending on education, infrastructure and the like would cost in excess of $1 trillion over 10 years. The NCPA model estimates that the revenue raised by her tax plan would cover only half of new spending, resulting in further increases in the debt.
The NCPA posted this analysis today and the full study will be published next week.
Hillary Clinton's Tax Plan under the NCPA's Model of the U.S. Economy: http://www.ncpa.org/pub/hillary-clinton-s-tax-plan-under-the-ncpa-s-model-of-the-us-economy