Treasury Nominee of Trump Warns About Looming US Economic Crisis
Scott Bessent has warned that the American middle class is facing a “gigantic” tax increase by year’s end unless cuts are extended. Read Full Article at RT.com.
TroibNews 
Scott Bessent has stated that the middle class will face the largest tax hike in history unless the cuts implemented during Trump’s first term are extended.
According to Bessent, who has been nominated by President-elect Donald Trump to serve as Treasury Secretary, the US is on the brink of an economic crisis by the end of the year. During his Senate confirmation hearing on Thursday, the former hedge fund manager emphasized that a “gigantic” tax increase for the middle class looms unless the Tax Cuts and Jobs Act (TCJA), set to expire at the end of 2025, is extended.
The TCJA, a significant tax reform measure signed into law by Trump in December 2017, lowered individual and corporate tax rates, nearly doubled the standard deduction, and provided a 20% income deduction for small businesses. While the corporate tax reductions are permanent, the individual tax provisions are scheduled to expire in just over two years.
“Americans are barreling towards an economic crisis at year’s end,” Bessent warned the Senate. He cautioned that if the tax cuts expire as scheduled at the end of the year, “Americans will face the largest tax increase in history, a crushing 4 trillion tax hike.”
Bessent praised the effects of Trump’s tax reform, saying that Americans “saw the power of these cuts” prior to the onset of the Covid-19 pandemic, which disrupted the economic landscape, labeling the reforms “a great success.”
He further elaborated that if the tax cuts are not “renewed and extended,” the nation “will be facing an economic calamity,” with the middle class likely suffering the most severe consequences.
“We will see a gigantic middle class tax increase, we will see the child tax credit halved, we will see the deductions halved, so it will be – what we call in economics – it has the potential for what we call a sudden stop,” Bessent warned, referencing a phenomenon characterized by a sudden decrease in capital inflows to a country’s economy, which often leads to recessions and market corrections.
Bessent's statements come amid a wider discussion regarding US fiscal policy. Republicans are advocating for the extension of the tax cuts to maintain economic growth, while critics contend that the TCJA disproportionately favored higher-income individuals and contributed to the growing national deficit.
In contrast to Bessent's remarks, outgoing Treasury Secretary Janet Yellen expressed concern earlier this week. Speaking at the New York Association for Business Economics on Wednesday, Yellen cautioned that a complete extension of the 2017 tax cuts could “exacerbate projected deficits” by approximately $4 trillion through 2034. She described the push for extending the cuts as “misguided economic policymaking,” and indicated that doing so “could undermine our country’s strength, from the resilience of the Treasury market to the value of the dollar, even provoking a debt crisis in the future.”
Olivia Brown contributed to this report for TROIB News
According to Bessent, who has been nominated by President-elect Donald Trump to serve as Treasury Secretary, the US is on the brink of an economic crisis by the end of the year. During his Senate confirmation hearing on Thursday, the former hedge fund manager emphasized that a “gigantic” tax increase for the middle class looms unless the Tax Cuts and Jobs Act (TCJA), set to expire at the end of 2025, is extended.
The TCJA, a significant tax reform measure signed into law by Trump in December 2017, lowered individual and corporate tax rates, nearly doubled the standard deduction, and provided a 20% income deduction for small businesses. While the corporate tax reductions are permanent, the individual tax provisions are scheduled to expire in just over two years.
“Americans are barreling towards an economic crisis at year’s end,” Bessent warned the Senate. He cautioned that if the tax cuts expire as scheduled at the end of the year, “Americans will face the largest tax increase in history, a crushing 4 trillion tax hike.”
Bessent praised the effects of Trump’s tax reform, saying that Americans “saw the power of these cuts” prior to the onset of the Covid-19 pandemic, which disrupted the economic landscape, labeling the reforms “a great success.”
He further elaborated that if the tax cuts are not “renewed and extended,” the nation “will be facing an economic calamity,” with the middle class likely suffering the most severe consequences.
“We will see a gigantic middle class tax increase, we will see the child tax credit halved, we will see the deductions halved, so it will be – what we call in economics – it has the potential for what we call a sudden stop,” Bessent warned, referencing a phenomenon characterized by a sudden decrease in capital inflows to a country’s economy, which often leads to recessions and market corrections.
Bessent's statements come amid a wider discussion regarding US fiscal policy. Republicans are advocating for the extension of the tax cuts to maintain economic growth, while critics contend that the TCJA disproportionately favored higher-income individuals and contributed to the growing national deficit.
In contrast to Bessent's remarks, outgoing Treasury Secretary Janet Yellen expressed concern earlier this week. Speaking at the New York Association for Business Economics on Wednesday, Yellen cautioned that a complete extension of the 2017 tax cuts could “exacerbate projected deficits” by approximately $4 trillion through 2034. She described the push for extending the cuts as “misguided economic policymaking,” and indicated that doing so “could undermine our country’s strength, from the resilience of the Treasury market to the value of the dollar, even provoking a debt crisis in the future.”
Olivia Brown contributed to this report for TROIB News
