Zinger Key Points
- Trump says he would bring down the corporate tax rate to as low as 15%, below the current federal corporate tax of 21%.
- Economists fear his protectionist policies will lead to renewed inflationary pressure, necessitating more interest rate hikes.
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Republican presidential nominee Donald Trump in an interview with Bloomberg provided a glimpse into what a potential second term for him would look like. As fund managers, business leaders and billionaires gravitate toward him in droves, with the move more pronounced recently, former White House Director Anthony Scaramucci weighed in with his thoughts on the development.
Superficial Analysis: “The billionaire boys are all in for Trump,” said Scaramucci in a post on X, formerly Twitter. A cursory analysis showed that they expected lower taxes and pro-business regulation to be good for companies and America.
During the interview, Trump said he would bring down the corporate tax rate to as low as 15%, a full six points below the current federal corporate tax of 21%. The former president also said that he expects to beat the Democrats this time around with his economic agenda. With the unorthodox agenda of tax cuts, more oil, less regulation, higher tariffs and fewer foreign financial commitments, Trump is eyeing to sway the swing voters in his favor.
He also suggested that he would let Federal Reserve Chair Jerome Powell serve out his full term that ends by May 2026 and appoint JPMorgan CEO Jamie Dimon as Treasury Secretary. He may not be keen on banning TikTok this time around, he said in the interview.
Real Problem Lies Elsewhere: The real problem, according to Scaramucci, is what a potential Trump administration wants to do to the dollar, the constitution, the judiciary and the rules-based international system. “It is a brand of anarcho-Christian populism, which borders on fascism; it is a very dangerous time for the United States,” the founder of investment firm SkyBridge Capital said.
Scaramucci noted that the deficit spending is out of control. “If they devalue the dollar, they're going to disrupt the entire global capitalist system,” he said. “Joe Biden and his team are trying to keep things status quo, which is also impossible given the state of everything.”
The Bloomberg report said Trump's plan to renew his landmark 2017 Tax Cuts and Jobs Act, which carries an estimated price tag of $4.6 trillion, and to further reduce corporate taxes, may not help to bring about budgetary balance. This apart, his protectionist policies have the potential to exert upward pressure on interest rates, the report said, adding that it could only serve to aggravate America’s debt burden.
The ex-White House aide said, “I have been where the billionaire boys are now and I want to offer some caution and a perspective borne from up close experience, the tonic they are prescribing will be bad for America and the world.”
“I understand the need for change and reform but don't overly stress the system, a system where you have been a direct beneficiary.”
Scaramucci’s comments come as business leaders, led by Tesla CEO Elon Musk, endorsed Trump after the Pennsylvania rally shooting. Tech venture capitalist David Sacks has long been supporting the former president, while hedge fund manager Bill Ackman recently pledged allegiance to him.
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