Biden budget lays out battle lines against Trump

President Biden in his budget This week, major economic battle lines were drawn with former President Donald J. Trump, the presumptive Republican presidential nominee. The proposal offers the nation a glimpse of the divergent directions pension programs, taxes, trade and energy policies could take depending on the outcome of the November election.

Over the past three years, Mr. Biden has passed key pieces of legislation aimed at supporting the green energy economy, investing in infrastructure and strengthening the U.S. domestic supply chain with subsidies for microchips, solar technology and electric vehicles. Few of these priorities are shared by Mr. Trump, who has pledged to further cut taxes and erect new trade barriers if re-elected.

The inflection point will arrive as the economy enters the final stretch of what economists now expect will be a “soft landing” after two years of high inflation. However, the prospect of a second Trump administration has injected increased uncertainty into the economic outlook, as businesses and policymakers around the world prepare for what could be a sea change in U.S. economic management.

Here are some of the most striking differences in the economic policies of the two presidential candidates.

At first glance, Mr. Biden and Mr. Trump might appear to have similar positions on domestic welfare programs. In 2016, Mr. Trump broke with his fellow Republicans and refused to support cuts to Social Security or Medicare. Mr. Biden has long insisted that the programs must be protected and hammered Republicans who have suggested scaling back or scaling back the programs.

In his budget proposal Monday, Mr. Biden reiterated his commitment to preserving the country's welfare system. He called for new efforts to improve the solvency of Social Security and Medicare, including requiring wealthy Americans to contribute more to the health program. However, its plans were short on detail on how to ensure the long-term sustainability of both programs.

On Monday, Mr. Trump appeared to speak separately.suggests he was open to duty reductions. He said on CNBC that there are “a lot of things you can do in terms of reducing rights, but also in terms of theft and mismanagement of rights, very poor management of rights.”

The Trump campaign clarified that the former president was referring to reducing waste, but the Biden campaign seized on the comment. It's fast published an ad contrasting Mr. Trump's remarks with Mr. Biden's promise during the State of the Union to stop anyone who tries to cut Social Security or Medicare or raise the retirement age.

Although Mr. Trump has never signed cuts to Social Security or Medicare as president, he has flirted with the idea before. Asked about duty reductions in a CNBC interview in 2020, he said“When the time comes, we’ll take a look.”

One of the biggest contrasts between Mr. Biden and Mr. Trump concerns who — if anyone — should pay more in taxes.

The president proposed more $5 trillion in tax increases on corporations and the wealthy this weekincluding a new 25 percent minimum tax on the wealthiest Americans and an increase in the corporate tax rate from 21 percent to 28 percent.

Mr. Biden paired his proposed tax increase on the wealthy with tax relief for the middle class. He called for an expansion of the child tax credit, which many Republicans opposed, an expansion of eligibility for the earned income tax credit, and new tax credits aimed at making the more affordable housing for first-time buyers.

Mr. Trump signed the Tax Cuts and Jobs Act into law in 2017, which included nearly $2 trillion in tax cuts, much of which benefited corporations and the wealthy. Many of these tax cuts expire in 2025, meaning that whoever is president will have a say in whether they are extended or expired.

Mr. Biden wants to repeal much of the 2017 law, except for parts that benefit taxpayers earning less than $400,000.

Mr. Trump has given few details about his tax plans, but hinted at a February rally that he was considering another round of cuts.

“You're all getting the biggest tax cuts because we're making additional cuts and a whole new Trump economic boom like you've never seen before,” Mr. Trump said.

Speaking to CNBC on MondayMr. Trump said it would be “very bad for this country” if the Trump tax cuts were not extended.

Although Democrats and Republicans have become more polarized in recent years, trade policy is one of the few areas where views appear to have converged.

For all their differences, Mr. Biden has largely left intact the trade agenda that Mr. Trump presented to him. Tariffs on hundreds of billions of dollars of Chinese imports imposed by Mr. Trump have not yet been lifted, Mr. Biden has stepped up monitoring of Chinese investment in the United States and American investment in China, and the Biden administration's industrial policy has tense relations with certain European countries.

If re-elected, Mr Biden will likely continue his policy of deepening trade ties with US allies – a policy called “friend-shoring” – and reducing supply chain dependence on adversaries such as China. The Biden administration is expected to complete a review of China's tariffs in the coming months and could reduce some levies on consumer products and increase others that would further protect the booming U.S. electric vehicle sector.

Mr. Trump has indicated that he is preparing for a new round of trade wars. The former president and self-proclaimed “The Tariff Man” discussed imposing a 10 percent tariff on all imports in a second term and a tariff of 60 percent or more on Chinese products.

The Inflation Reduction Act of 2022 has become Mr. Biden's signature legislation and its future – as well as the trajectory of US climate policy – it depends on who wins the election.

Mr. Biden's economic team has moved quickly to roll out regulations associated with tax and climate law to anchor investments in clean energy and the electric vehicle supply chain in the economy. The Biden administration hopes the law can prove durable because many of these investments are made in states led by Republicans.

However, Mr. Trump, who has long derided electric vehicles as overpriced, underpowered and a threat to American jobs, should not be counted on to pass much of the law if he is elected.

“We are a nation whose leaders are calling for all electric cars, even though they don't go far, cost too much, and whose batteries are produced in China,” Mr. Trump said at a news conference. a rally in New Hampshire in January.

The former president, who withdrew the United States from the Paris climate accord, is also unlikely to prioritize further investments in clean energy.

For years, Mr. Trump has argued that solar power is inefficient and that wind turbines are responsible for the bird slaughter.

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