Study: Biden's Economic Policy Would Reduce Median Household Income by $6,500
On Sunday, the Hoover Institution released a new study analyzing the impact of Joe Biden's economic policy, according to the Wall Street Journal.
The Hoover Institution at Stanford is a public policy research center. The research center is ranked very high in its factual reporting and tends to analyze conservative policies. The new study stated that Biden's economic policies would have a damaging impact on growth, job creation, and household income.
However, the study does not go as far as to predict a "depression," something President Trump has stated. The current state of the economy is solid, it is recovering from the pandemic faster than most economists predicted. Biden would inherit an economy with strong growth momentum if he wins on November 3. The housing market is surging, small-business sentiment is bullish, manufacturing is working its way back, and a COVID-19 vaccine is in the horizon. Whoever wins the presidential election has all the pieces for a booming economy.
The question is whether Biden's policies would contribute to this recovering economy or prolong it. The study done by the Hoover Institution analyzed Biden's proposals on health insurance, taxes, energy, and regulation. The authors of the study estimate that a Biden presidency would reduce real GDP per capita by more than 8 percent. Compared to the Congressional Budget Office estimates, this would result in $2.6 trillion less in GDP and $6,500 less in median household income.
“Biden’s plan to raise personal income and payroll tax rates would push their federal rates from below 40 percent to, often, above 50 percent, and these are on top of state income taxes,” the authors write.
Furthermore, Biden's proposed 12.4 percent Social Security payroll hike to incomes above $400,000 would increase labor costs. The $400,000 index is fixed and would apply to more Americans over the years due to inflation.
The Hoover study contains all the details, but these are the main highlights from the 50+ page study.