Donald Trump’s economic plans for the presidency would tip the U.S. into a severe recession, according to a new report from Moody’s Analytics.
The analysis, which attempts to gauge Trump’s agenda in the way that official government models would, finds that the presumptive Republican nominee’s tax, spending, immigration and trade plans would cause a “lengthy recession” in his first term, with higher unemployment and larger federal debt.
“The upshot of Mr. Trump’s economic policy positions under almost any scenario is that the U.S. economy will be more isolated and diminished,” the report concludes.
Among the report’s authors is economist Mark Zandi, a prominent private-sector forecaster who is also known for having provided advice to John McCain during the Arizona senator’s 2008 presidential campaign.
The economy finds that the Trump policies that would shrink the deficit are some of the former real estate magnate’s top campaign talking points.
In particular, his promises to deport illegal immigrants and renege on trade deals, which Trump has claimed will boost workers’ wages, will constrain the supply side of the economy and slow growth in the Moody’s model. That model is meant to be similar to the models of the economy used by the Federal Reserve and the Congressional Budget Office.
Furthermore, Trump’s proposed $10 trillion tax cut would increase debt, pushing up interest rates and decreasing investment.
As a result, 3.5 million jobs would be lost by the end of his first term, if he were able to implement all his proposals. The losses would be mitigated if Congress slowed or stopped some of his platform planks, which would likely be the case.
Trump’s campaign is said to be working with outside economists to revamp his tax reform plan to make it less costly to the Treasury.
Moody’s Analytics also plants to estimate the impact of Hillary Clinton’s economic plans.
