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Trump’s own economists now agree: The GOP tax cuts are a failure

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President Trump’s hand-picked Federal Reserve chairman and White House economic advisers admitted this week that the Republican tax cuts are failing to deliver the economic growth the president promised.

This article first appeared in Salon.

Trump repeatedly claimed that the Republicans’ $1.5 trillion tax cut primarily aimed at corporations and the rich would pay for itself with annual economic growth above 3 percent. Trump went as far as to claiming the cuts might lead to a GDP growth of 6 percent.

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Trump’s White House Council of Economic Advisers (CEA) released an analysis in 2017 showing that slashing corporate taxes by 15 percent would lead to GDP growth of 3 to 5 percent.

On Tuesday, the CEA released a revised report showing that the economic gains will fall far short of their initial forecast.

According to the CEA, growth is projected to slow to 2.5 percent by 2022 and then decline to 2 percent by 2026. Even that estimate is rosy, according to most economists, the Washington Post reports, who expect projected growth to fall to 2 percent well before 2026.

The CEA numbers are more optimistic than those of independent economists because the White House must assume that all of Trump’s policy proposals will be implemented, the New York Times reports, including his improbable call to make individual tax cuts permanent, an infrastructure package Trump has stopped mentioning, and a rollback of regulations that states themselves would have to implement, which is not under the control of the federal government.

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The CEA estimate predicts a strong 3.2 percent growth in 2019, but that number was contradicted by Federal Reserve chair Jerome Powell on Wednesday.

Powell said in a news conference that GDP growth is slower than expected and the Fed now projects 2.1 percent growth in 2019, well below the White House estimate, and just 1.9 percent growth in 2020.

Powell said that consumer spending and business investment “suggest that growth is slowing somewhat more than expected.” As a result, the Fed is not expected to raise interest rates at all this year over concerns about the slowed growth.

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Kevin Hassett, Trump’s top economic adviser, told the Post that the analysis was wrong because the administration was able to achieve 3.1 percent growth over the last year.

“Everyone said we wouldn’t get 3.1 percent,” Hassett said. “We’re relying on the same analysis because nothing has come up which suggests to us it’s not going to happen.”

Marc Goldwein, senior policy director at the Committee for a Responsible Federal Budget, rejected Hassett’s claim.

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“We’ve always said 3 percent growth for one year was possible after we gave the economy a lot of stimulus. But you can’t keep giving the economy more stimulus every year,” he told the Post. “There’s nobody that thinks we’re going to be anywhere close to 3 percent growth a year over the next decade.”

Former Federal Reserve chair Janet Yellen made a similar statement to Marketplace last month, noting that there has not been “any meaningful pickup” in business spending as a result of the tax cuts.

“We had a period of remarkable growth in 2018, probably around 3 percent,” she said. “That just isn’t sustainable.”

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Ex-AG Matt Whitaker ‘pretty much acknowledges abuse of power’ in Fox News interview

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The former acting Attorney General of the United States argued that presidential abuse of power is not a crime during a Tuesday evening appearance on Fox News.

Abuse of power is not a crime,” Matt Whitaker told Fox News personality Laura Ingraham.

Tufts University Professor Daniel Drezner was fascinated by the admission.

"Interesting that Whitaker pretty much acknowledges abuse of power but doesn’t think it’s egregious," Drezner noted.

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2020 Election

‘Abuse of power is not a crime’: Former acting AG Matt Whitaker makes a brazen claim on Fox News

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Former acting Attorney General Matt Whitaker told a Fox News audience that it is not a crime for President Donald Trump to abuse the power of his office.

Whitaker made the comments while complaining about "global elitists" during an interview with Laura Ingraham.

"What evidence of a crime do you have?" Whitaker asked, despite Trump, acting White House Chief of Staff Mick Mulvaney and defense lawyer Rudy Giuliani all admitting Trump sought foreign election interference to help his struggling re-election campaign.

"Abuse of power is not a crime," the nation's former top law enforcement office argued.

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2020 Election

Joe Biden apologizes for ‘partisan lynching’ comments about Bill Clinton’s impeachment

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Former Vice President Joe Biden on Tuesday apologized for comments he made saying impeachment could be viewed as a "partisan lynching."

The comments from a 1998 interview were reported after Biden said it was "abhorrent" and "despicable" for President Donald Trump to refer to impeachment as a lynching.

"Even if the President should be impeached, history is going to question whether or not this was just a partisan lynching or whether or not it was something that in fact met the standard, the very high bar, that was set by the founders as to what constituted an impeachable offense," Biden said in 1998.

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