The Chicago Booth School of Business’s Initiative on Global Markets (IGM) Forum polled a panel of leading economists on the recent tax reform bill, the Tax Cuts and Jobs Act, currently moving from the House to the Senate. Responses indicate that the majority of experts do not believe the new tax plan would substantially grow the GDP. The majority also believe the plan will lead to more debt.
The IGM frequently publishes the results of its questionnaires on pressing economic topics. It has stated that, through its polls, its “expert panelists have been informing the public about the extent to which economists agree or disagree on important public policy issues” for the past two years.
The bill has recently come under fire, as some say it caters to the wealthy. Others have expressed concern that the tax the bill would impose on graduate student waivers and would make graduate school less accessible for many Americans.
The questions asked by the IGM Forum were geared primarily toward effects on the GDP. The first question asked if the United States GDP will increase significantly a decade from now if the a tax bill like the one in Congress right now is enacted. While only 2 percent of respondents agreed with the statement, 36 percent were uncertain, 33 percent disagreed, and 19 percent strongly disagreed.
Of the respondents, most University of Chicago professors disagreed with the statement, with only two calling themselves uncertain. Professor Richard Thaler wrote that, “Aside from the redistribution of wealth, hard to see [the bill] changing much.” On the same question, professor Austan Goolsbee, a current economics professor and former Chairman of the President’s Council of Economic Advisers stated, “Of course not. Does anyone care about actual evidence anymore?”
The second question asked if the United States debt-to-GDP ratio will rise if the same type of bill passes. Only 2 percent of respondents were uncertain, while 45 percent are strongly agreed and 43 percent agreed.
Seven University of Chicago professors agree or strongly agree with the statement. Professor Anil Kashyap wrote that he worries especially “about the lost revenue from the pass-through loopholes” in the bill.