Donald Trump vs. Hillary Clinton on money: How their economic policies will affect you
Economic issues will be top-of-mind as presidential nominees Hillary Clinton and Donald Trump face off at Hofstra University Monday night in the first of three official debates ahead of Election Day.
One of three topics announced last week by moderator Lester Holt — "achieving prosperity" — suggests a good portion of the night will cover how the respective candidates plan to handle tax policy, trade, jobs and economic growth in the United States.
Throughout the last few months, economic concerns have consistently topped surveys of topics most important to voters. While some polls suggest voters see Trump as stronger on handling the economy, others put Clinton in the lead.
Economists tend to prefer Clinton, and Trump's last-minute approach to the election's home stretch has not helped inspire confidence: He announced a re-worked tax plan less than two weeks before the debate, then released a paper Sunday night by two advisors who claim Trump's presidency would boost revenues and jobs.
"It puts him in a strong position for the debate tonight ... because no one is going to follow all this arithmetic," Gary Hufbauer, an economist with the Peterson Institute for International Economics, said in a phone call. The Peterson Institute projects Trump's plan could cost the U.S. 4.8 million jobs.
Clinton's proposed policies, by contrast, have been available for awhile, and researchers have been parsing her tax plan since January.
Given the candidates' different approaches — and the fact that debates are often heavy on rhetoric and light on policy specifics — it might be challenging to separate economic fact from fiction on Monday night.
To cut through the B.S., Mic talked to experts on taxes, trade and student debt to show you clearly how a Clinton or Trump presidency might actually affect your bank account.
Trump is offering you $3,000 — or maybe way less?
According to a presidential tax calculator developed by Vox and the Tax Policy Center, based on Trump's tax proposals as of March, a two-child household making the median household income — $56,500 — would expect to save more than $3,000 per year.
That's a lot more in savings than new calculations suggest.
A two-child family making $50,000 a year with $8,000 in child care expenses would raise their tax refund by a little less than $100 under Trump's newly released plan, according to an analysis by the Wall Street Journal, while a similar family earning $75,000 and spending $10,000 on child care would save more than $1,000.
Trump's job growth promises may be off by 90%.
Trump's pitch is that he will stimulate job and wage growth by cutting corporate taxes and deregulating the energy sector. He is promising that the economic growth he creates will lead to about 25 million new jobs over the course of 10 years.
"It doesn't add up," Douglas Holtz-Eakin, an economist who advised President George W. Bush and Senator John McCain, told the Wall Street Journal.
Even groups that favor lowering taxes to stimulate growth, like the Tax Foundation, have raised eyebrows.
"Our estimates show that, because [Trump's plan] reduces marginal rates, especially on corporate investment, it would result in higher wages and 1.8 to 2.4 million jobs," Kyle Pomerleau, director of federal projects at the Tax Foundation, told Mic. "But he was promising far more jobs than that. Millions more than that."
The other danger in trying to stimulate growth by slashing taxes is that it leaves big holes in the U.S. budget — which could inflate the deficit.
"His plan shows very little attention to balancing the budget," Bob Williams, an analyst at the Urban-Brookings Tax Policy Center, told Mic.
Rich people will pay far more in taxes under Clinton.
A central tenet in Clinton's tax plan is increasing fairness by closing tax "loopholes" benefitting wealthier Americans.
Her policies build on what's called the "Buffett Rule," a set of proposals first raised by President Barack Obama to ensure the super-rich pay at least 30% of their income in taxes.
Her fact sheet has a litany of such policies, including increases to the estate tax; a surcharge on households making 5 million or more; and closing loopholes that let the wealthy store millions of dollars untaxed in havens like Bermuda or in retirement accounts.
For instance, that same two-child median household — with $56,500 a year — would pay about $30 more annually under Clinton, according to the TPC's calculator.
One downside to Clinton's plan?
The Tax Foundation's Pomerleau said new taxes on the rich could create more deadweight loss, or the economic costs of market adaptation to a new policy, like a higher tax rate.
But that's a red herring criticism, according to Urban-Brookings Tax Policy Center's Williams: "Nobody at that level is doing their own taxes."
Clinton to student debtors: "Here's $2,000."
Clinton has released a detailed policy outline for how her administration would tackle college affordability, drawing heavily on the ideas of her Democratic primary opponent, Senator Bernie Sanders.
In addition to expanding student loan forgiveness, deferment and assistance to entrepreneurs, AmeriCorps members and public servants, Clinton also proposes making public tuition completely free for families earning less than $125,000.
Clinton's plan would allow student debtors to refinance at the 2016 federal rate of 3.76%, which — depending on how much you owe, your rate and the term of your loan — could save borrowers thousands of dollars.
Based on Mic's calculations, her refinancing plan could save a typical college graduate earning a median household salary close to $2,000 over the course of a 10-year loan.
"I really think Clinton is the clear winner here, she has a robust plan," Andy Josuweit, founder and CEO of Student Loan Hero, told Mic. "You really don't hear much from Trump ... He believes the [federal government] shouldn't be in the student loan business. So I believe with Trump there's a chance he would probably try to move more money into state hands."
Trump's "issues" page on his campaign website doesn't address student loans specifically, and he hasn't yet released a detailed plan as Clinton has, although he has addressed the topic of student debt sympathetically in general terms.
"We're going to work with all of our students who are drowning in debt to take the pressure off these people just starting out in their adult lives," he said in his GOP convention speech.
Say goodbye to cheap imports, if Trump wins.
Trump has repeatedly stated the need to rewrite and scrap existing deals like the North American Free Trade Agreement and the proposed Trans Pacific Partnership agreement. And unlike with taxes or student loan regulation, Trump could make a lot of changes to existing trade agreements without congressional approval.
Many economists — progressive and conservative, domestic and international alike — have expressed concerns that these policies, including a proposed 45% tax on imports from China, could spark a trade war, weaken economic growth or even cause a recession.
Though policy under Clinton, who also opposes TPP, would also be costly, Trump's plan is far more dramatic — and therefore could have more dramatic consequences, the Peterson Institute found.
Even Economic Policy Institute senior economist Robert E. Scott — whose work Trump has cited in policy speeches on trade — has called these plans "a terrible mix of ignorance and hubris."
The projections released late Sunday night by Trump's economic advisors — Peter Navarro of the University of California, Irvine, and investor Wilbur Ross — claim trade reforms would go most of the way in raising the extra $2.4 trillion in revenue over the next decade that Trump has promised.
But the advisors were ambiguous about why, exactly, countries like China would be willing to make their import and export taxes so much more favorable for Americans, simply citing Trump's "strength."
"[China] will acknowledge the strength and resoluteness of Trump and rein in their mercantilist impulses," they wrote in the plan.
The Peterson Institute's Hufbauer told Mic he's skeptical that China will be willing to enact one-sided reforms.
"You then have to ask yourself, 'Is that plausible?'" he said. "Everyone can speculate ... There's no evidence of that happening in the past."
The stakes are high.
One study from researchers at University of California, Los Angeles, and Columbia University found that reversing free trade would reduce the purchasing power for the lowest-income Americans by 63%.
In other words, the poorest Americans will be able to buy only a little more than a third of what they can afford today.
So watch carefully tonight, America: You've got a lot of money on the line.