In Bloomberg View, Stevenson identifies “Where Trump should look to cut costs”
Betsey Stevenson’s latest column for Bloomberg View suggests looking to the tax code to cut wasteful spending, rather than cutting programs like environmental protection and support for science and the arts.
The April 20 article, “Where Trump Should Look to Cut Costs,” says that special tax credits, deductions, and other provisions cost $1.2 trillion every year. “That’s more than the government’s total discretionary budget, including defense,” Stevenson writes.
While some provisions have a significant positive impact and are worth keeping, she says, research shows that others do not have the intented effect, such as the home mortgage interest deduction.
“The issue with tax expenditures is that we never review them,” Stevenson says. While non-defense discretionary spending is stable or decreasing as a percentage of GDP, tax expenditures and mandatory spending keep growing. “It’s the latter that desperately need review.”
Stevenson says that it will especially be up to Millennials and the following generation to demand a reassessment.
Betsey Stevenson (@BetseyStevenson) is an associate professor of public policy and economics. She served as an appointed member of the White House Council of Economic Advisers (2013-2015) and as chief economist of the U.S. Department of Labor (2010-2011).