Trump’s Treasury candidate issues caution of US economic catastrophe
Date
1/20/2025 7:05:25 AM
(MENAFN) Scott Bessent, President-elect Donald Trump’s nominee for Treasury Secretary, warned that the US could face an economic crisis by the end of 2025 if the Tax Cuts and Jobs Act (TCJA) is not extended. Speaking at his Senate confirmation hearing, Bessent, a former hedge fund manager, predicted a "gigantic" middle-class tax hike and a potential $4 trillion tax increase if the tax cuts expire as scheduled.
The TCJA, signed by trump in December 2017, lowered individual and corporate tax rates and introduced various benefits, including a 20% income deduction for small businesses. While corporate tax cuts were made permanent, individual tax cuts are set to expire at the end of 2025.
Bessent argued that the expiration of these cuts would lead to significant financial hardships, especially for the middle class, including halved child tax credits and deductions. He called this scenario a "sudden stop" in economic terms, where abrupt changes lead to recessions and market corrections. Bessent’s comments contrast with those of outgoing Treasury Secretary Janet Yellen, who warned that extending the TCJA could worsen the national deficit and provoke a debt crisis.
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