Nobel laureate explains how Trump could cause ‘economic chaos’

This was stated by Nobel Prize laureate Paul Krugman. Donald Trump The election proposals could cause “economic chaos” and cause significant damage to American economic development. Social Security programs.

The economy remained the focus throughout 2024 presidential elections Voters are especially concerned about how each candidate’s policies might affect the cost of goods and services for the average American. Although Trump generally maintained his lead in the polls Kamala Harris when it comes to economic issues, and some experts have hailed the former president’s policies as economically sound, others are concerned that his tariff offers And extreme immigration plans may aggravate financial difficulties of citizens.

“Donald Trump’s economic proposals, if enacted, (could) bankrupt Social Security, impoverishing many older Americans,” Krugman wrote in a column for the Journal on Thursday. New York Times.

Newsweek reached out to the Trump campaign for a response to Krugman’s article.

Krugman, who won the 2008 Nobel Prize in economics for his contributions to international trade theory, cited an October report by the Committee for a Responsible Federal Budget (CRFB) that warned that Trump’s proposal eliminate tip taxesOvertime pay and Social Security benefits may jeopardize program funding capabilities.

Krugman said the “inflationary” effects of Trump’s tariffs, as well as the planned deportation of undocumented migrants, “many of whom pay payroll taxes,” would “make the situation even worse.” He added that the CRFB’s projections “do not take into account the economic chaos that Trump’s deportations and tariff policies will likely create” or the “trillions” his administration will add to the national debt.

But other institutions backed Trump’s plans and questioned Harris’ claim that she has the backing of America’s top economist.

University Pennsylvania Penn Wharton Budget Model proposed by Harris said she approved of her economic planspreviously said Newsweek that Harris’ tax and spending proposals would increase the government’s primary deficit, although less than Trump’s. However, in response to the vice president’s claim that her proposals would “strengthen the economy,” it said, “We have found no positive impact of her plan on the economy in any future year.”

Despite significant increase in deficit Trump’s first three years in office were marked by a number of economic gains, according to Trump’s analysis of his tenure, which has accelerated sharply since the onset of the Covid pandemic. BBC. During this period, his administration oversaw an annual growth rate of 2.5 percent and the creation of 6.7 million jobs, compared with 2.3 percent and 7 million in the last three years of economic growth. Obama administration accordingly.

Voters appear broadly confident in the former president’s record and plans for the future, and are less than enthusiastic about the state of the struggling U.S. economy, according to recent polls. Joe Biden and Harris.

The survey was conducted Newsweek found in early October that 51 percent of voters thought the economy we’re moving in the wrong directioncompared with just 30 percent of those who are optimistic about America’s economic future.

Although Harris has closed the gap, and in some cases reversed Trump’s previous advantageThe former president maintains his lead among voters on the economy, according to most major polls.

On Thursday, a joint survey conducted Financial Times and the University of Michigan’s Ross School of Business found that 44 percent favored Trump on the economy, compared with Harris’ 43 percent, reversing her 2-point September lead.

In the latest NYU-Siena poll of likely voters released Friday, 52 percent of respondents said they trust the former president over Harris to do a “better job” on the economy.

According to the same poll, the economy far outranks issues like abortion, immigration and democracy in terms of its importance in the minds of the American electorate, with 27 percent of respondents citing it as the most important factor in determining their vote.

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