Middle-Market Public Policy Roundup
The BEA reports that take-home pay is rising as a result of tax reform, President Trump's trade moves face backlash, and the SEC cracks down on cryptocurrencies.
A government agency reported that take-home pay is rising for U.S. workers as a result of the tax-reform bill passed in December. Meanwhile, President Trump’s moves on trade are frustrating industry as well as foreign partners, and the SEC has begun taking action against initial coin offering issuers.
Incomes Rise from Tax Cut—Bureau of Economic Analysis
The Tax Cuts and Jobs Act, signed last year by President Trump, is starting to increase take-home pay, according to the Bureau of Economic Analysis. In its January report, the BEA estimates that “the TCJA reduced personal current taxes by $115.5 billion at an annual rate.” The report shows that January estimates of wages were adjusted to include $30 billion from bonuses paid by businesses, and disposable personal income increased by $134.8 billion. The individual tax provisions in the law are temporary, ending in 2025.
According to Politico, the tax cuts will now cost upward of $2.3 trillion and will almost certainly not pay for themselves.
(Trade) War, What Is It Good For?
President Trump announced on Thursday that he will impose a 25 percent tariff on steel imports and a 10 percent tariff on aluminum, in an effort to revive domestic manufacturing, The Hill reports.
The move sent the Dow Jones industrial average down by nearly 500 points, and many trade groups representing industries that use aluminum and steel extensively denounced the action, saying it would drive consumer costs upward.
Meanwhile, the European Union has said it will take retaliatory action. President Trump enacted the rule unilaterally, using a law that gives U.S. presidents “broad discretion to curb imports deemed a threat to ‘national security.’”
The president later stated that “trade wars are good, and easy to win.”
President Trump enacted the rule unilaterally, using a law that gives U.S. presidents “broad discretion to curb imports deemed a threat to ‘national security.’”
SEC Cracks Down on Cryptocurrencies
The SEC is issuing subpoenas to firms involved in cryptocurrencies, The Wall Street Journal reports. The actions focus primarily on the rapidly expanding market for initial coin offerings, which can be used to finance the development of new cryptocurrencies, or as a form of venture capital-like fundraising for new products. The SEC has continued to watch the market as public interest in cryptocurrencies has increased. According to an MIT study of the market for ICOs, an estimated $270 million to $317 million raised by such coin offerings is likely fraudulent.
Postscript
The Senate Banking Committee bill that we reported on last week, which would reduce regulatory burdens from Dodd-Frank for some banks, is set for a Senate vote next week, Bloomberg reports.
Check back each Friday for the weekly Public Policy Roundup. Is there a policy issue you’d like us to cover? Send your suggestions to MMG Editor Kathryn Mulligan at kmulligan@acg.org.
Ben Marsico is ACG Global’s manager of legislative and regulatory affairs.
