Citation:

Tushar Kapoor, Shiv Bhatia. "Evaluating the First Trump Administration: Growth, Inequality, & Fiscal Sustainability in the US (2017–21)" International Research Journal of Economics and Management Studies, Vol. 4, No. 11, pp. 152-161, 2025. Crossref. http://doi.org/10.56472/25835238/IRJEMS-V4I11P121

Abstract:

This paper examines how the Tax Cuts and Jobs Act (TCJA 2017–2021) affected the long-term US economy. We analyse whether the TCJA helped boost investment, growth, and employment, as intended, or if it led to rising inequality and long-term deficits. We hypothesize that the TCJA had a limited positive impact and increased fiscal risk. We used academic sources, government data, and research from economic policy institutions. In addition, we surveyed US citizens to understand how the public views the policy's effects. Our findings suggest that the TCJA gave a brief boost to growth and employment, but did not lead to major long-term investment. Corporations directed most of their gains to stock buybacks. Federal revenue fell, and inequality rose. The results show that broad tax cuts may not always deliver sustained economic benefits.

References:

[1] Fiscal policy: taking and giving away. (2019, June 28). IMF. https://www.imf.org/en/Publications/fandd/issues/Series/Back-to-Basics/Fiscal-Policy
[2] Floyd, D. (2025, January 31). What is the Tax Cuts and Jobs Act (TCJA)? Investopedia. https://www.investopedia.com/taxes/trumps-tax-reform-plan-explained/
[3] Wikipedia contributors. (2025, June 24). Economic policy of the first Donald Trump administration. Wikipedia. https://en.wikipedia.org/wiki/Economic_policy_of_the_first_Donald_Trump_administration
[4] Classical vs. Keynesian Perspectives | Intermediate Macroeconomic Theory Class Notes | Fiveable. (n.d.). Fiveable. https://library.fiveable.me/intermediate-macroeconomic-theory/unit-12/classical-vs-keynesian-perspectives/study-guide/frDfzLSh9FqLbklP
[5] Hayes, A. (2024, May 31). Laffer Curve: History and critique. Investopedia. https://www.investopedia.com/terms/l/laffercurve.asp
[6] Team, I. (2024, October 7). Ricardian Equivalence: definition, history, and validity Theories. Investopedia. https://www.investopedia.com/terms/r/ricardianequivalence.asp
[7] Wikipedia contributors. (2025b, June 24). Economic policy of the first Donald Trump administration. Wikipedia. https://en.wikipedia.org/wiki/Economic_policy_of_the_first_Donald_Trump_administration
[8] Team, I. (2022, December 1). How can a change in fiscal policy have a multiplier effect on the economy? Investopedia. https://www.investopedia.com/ask/answers/050515/how-can-change-fiscal-policy-have-multiplier-effect-economy.asp
[9] Wikipedia contributors. (2025a, January 2). Crowding out (economics). Wikipedia. https://en.wikipedia.org/wiki/Crowding_out_(economics)
[10] Tax Foundation. (2024, March 5). Tax Cuts and Jobs Act (TCJA) | TaxEDU Glossary. https://taxfoundation.org/taxedu/glossary/tax-cuts-and-jobs-act/
[11] Krupkin, A., Toder, E., Gelfond, H., Mazur, M., & Gale, W. G. (2018, June 14). Effects of the Tax Cuts and Jobs Act: A preliminary analysis. Brookings. https://www.brookings.edu/articles/effects-of-the-tax-cuts-and-jobs-act-a-preliminary-analysis/
[12] Trump’s Defense Budget. (2018, February 28). Center for American Progress. https://www.americanprogress.org/article/trumps-defense-budget/
[13] Parrott, S., Aron-Dine, A., Rosenbaum, D., Rice, D., Floyd, I., & Romig, K. (2018). Trump budget deeply cuts health, housing, other assistance for Low- and Moderate-Income families. Center on Budget and Policy Priorities. https://www.cbpp.org/research/trump-budget-deeply-cuts-health-housing-other-assistance-for-low-and-moderate-income
[14] Budget, C. F. a. R. F. (2024, July 12). How much did President Trump add to the debt?-2024-01-10. Committee for a Responsible Federal Budget. https://www.crfb.org/blogs/how-much-did-president-trump-add-debt
[15] Srinivasan, H. (2025, May 25). US Debt by President: Dollar and Percentage. Investopedia. https://www.investopedia.com/us-debt-by-president-dollar-and-percentage-7371225#toc-the-bottom-line
[16] MACROTRENDS. (2025, May 31). US GDP growth Rate | Historical chart & data. https://www.macrotrends.net/global-metrics/countries/usa/united-states/gdp-growth-rate
[17] Amadeo, K. (2022, March 7). US Real GDP Growth Rate by Year Compared to Inflation and Unemployment. The Balance. https://www.thebalancemoney.com/u-s-gdp-growth-3306008
[18] Page not found. (n.d.). Tax Policy Center. https://taxpolicycenter.org/briefing-book/what-were-economic-effects-tax-cuts-and-jobs-act
[19] Recent slower economic growth in the United States: policy implications. (2020). In CRS Reports. https://www.everycrsreport.com/reports/R46200.html
[20] What were the economic effects of the Tax Cuts and Jobs Act? (n.d.). Tax Policy Center. https://taxpolicycenter.org/briefing-book/how-might-tax-cuts-and-jobs-act-affect-economic-output
[21] Miller, M. (2024, May 8). Tax cuts are primarily responsible for the increasing debt ratio. Center for American Progress. https://www.americanprogress.org/article/tax-cuts-are-primarily-responsible-for-the-increasing-debt-ratio/
[22] Unemployment rate in the United States (2015 - 2021). (n.d.). GlobalData. https://www.globaldata.com/data-insights/macroeconomic/the-unemployment-rate-in-the-united-states/
[23] Americans for Tax Fairness. (2024, June 25). Engine of inequality: a flood of corporate profits is enriching wealthy shareholders through stock buybacks and dividends, at the expense of workers and the public - Americans for tax fairness. https://americansfortaxfairness.org/engine-inequality-flood-corporate-profits-enriching-wealthy-shareholders-stock-buybacks-dividends-expense-workers-public/
[24] US Inflation Calculator. (2025, June 11). Current US inflation rates: 2000-2025. US Inflation Calculator | Easily Calculate How the Buying Power of the US Dollar Has Changed From 1913 to 2023. Get Inflation Rates and US Inflation News. https://www.usinflationcalculator.com/inflation/current-inflation-rates/
[25] Tepper, T. (2025, May 8). Federal funds rate history 1990 to 2025. Forbes Advisor. https://www.forbes.com/advisor/investing/fed-funds-rate-history/

Keywords:

Income Inequality, Fiscal Policy, Tax Cuts and Jobs Act (TCJA), Trump Administration.