Tax Reform: Trajectory of Younger Generations Not Predetermined. Anas Faiq, Audencia Business School.
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Sen. Bennet, D-CO (right) at Politico |
Senator Ron Johnson criticized the proposed tax reforms, stating that they primarily benefit only 5% of businesses, leaving 95% unaddressed. He advocated for budget cuts through two separate bills aimed at reducing spending by $1.5 trillion. Johnson emphasized the simplicity of the current tax code and highlighted that tariffs could raise $1 trillion in revenue. He also pointed out that since 2019, the U.S. has maintained an annual spending level of $4.6 trillion, suggesting the need for more fiscal discipline.
Representative Mike Lawler focused on the SALT deduction cap, advocating for its increase from $10,000 to $20,000. He introduced legislation to address this issue, citing the burden of property taxes on middle-class and upper-middle-class families in high tax states like New York. Lawler noted that former President Trump also supported lifting the cap as part of the broader tax reform package. Beyond the policy debate, Lawler expressed his ambition to become the next governor of New York, positioning himself as a champion of tax relief for his constituents.
Senator Michael Bennet presented a strong critique of the Republican tax proposals, arguing they overwhelmingly favor the wealthiest Americans. Bennet pointed out that 50% of the benefits would go to the top 5% of earners, with 25% going to the top 1%. He dismissed claims that tax cuts would "pay for themselves," calling the notion widely debunked. Bennet also voiced opposition to adjusting the SALT deduction, emphasizing that such a move would add another $1.2 trillion to the national deficit. He expressed concern for vulnerable populations, particularly children in underprivileged school districts, who he argued would remain “invisible” under the administration’s policies. Furthermore, he warned that current economic policies would leave young people poorer than their parents.
However, there are many factors that challenge the idea that young people are destined to be worse off than their parents. The rapid growth of the digital economy and technological advancements has created new industries and job opportunities that didn’t exist a generation ago. Globalization and remote work have made it easier for young people to access international markets, launch businesses, and adapt to changing economic conditions. Additionally, access to financial education and investment tools are more widespread, enabling young people to build wealth in innovative ways. While challenges like rising housing costs and inflation are significant, the unique opportunities available today suggest that the economic trajectory of younger generations is not necessarily predetermined.