OPINION: Another 71,000 Unemployed Shows We Need Tax Cuts Extended

Unemployment increased by another 71,000 in May, reaching 7.2 million, the highest since October 2021, [according to the jobs report issued by the U.S. Bureau of Labor Statistics on June 6]. This is what usually happens following peak inflation historically after the American people max out their credit accounts — consumer credit is now down 0.8 percent the past year — and slow down purchases, and is consistent with the slowdown seen in the first quarter. This has been going on for a couple of years now, with unemployment now up by 1.49 million since January 2023, with most of the losses, 1.2 million, a relic from the Biden administration. In addition, the number of Americans saying they have jobs decreased by 696,000, worrisome in any month, although the labor market is still at peak employment at 163.2 million. While everyone is hoping for the best economy possible, the reality is that the inflation under the previous administration left the economy in a weak state, as evidenced by the slow, steady rise of unemployment. That’s usually a great time for Congress to provide some needed stimulus, in this case, by extending and expanding the 2017 Trump tax cuts, including adding no taxes on tips and overtime, providing tax relief to seniors, and including 100 percent expensing for domestic manufacturing and factories to bring jobs back to the U.S. These reforms will help blue-collar Americans and put the economy in a position for a solid recovery — a boom not seen since the 1980s — but only if members of Congress keep their heads. If Congress does not act, taxes will increase on 80 percent of Americans, and why would that help the economy? The American people voted against increasing taxes in the 2024 election, with 77 million voting for President Donald Trump and Republican majorities in Congress to get the job done and extend and expand the tax cuts. If the economy weakens, and Republicans fail to act, they will have lost their mandate to govern. It’s true that more could be done to cut spending, even as the Congressional Budget Office (CBO) notes about $1.4 trillion of offsets over the next decade in the One Big Beautiful Bill Act. President Trump’s tariff policies also appear poised to bring in an additional $2.8 trillion, according to the CBO, including federal interest payments by $500 billion. That is good news and fully offsets the tax legislation. It also shows the long-term wisdom of the president’s policies and why they need to be sustained. Still, some members [of Congress] also have highly legitimate concerns over voting to increase the debt ceiling. If that means there are not at least 51 votes in the Senate to provide tax relief and boost the economy, then maybe raise the debt ceiling separately, which might provide an opportunity to deal with the long-term fiscal challenges facing the nation, with more than 900,000 Americans retiring every year and not enough Americans being born to pick up the slack. It may be unreasonable to suggest all of these issues could somehow be addressed on what is expected to be the partisan budget-reconciliation process. To do that, Republicans need larger majorities, not razor thin majorities. Sure, it would be nice if Democrats joined in extending tax relief and expensing factories in the U.S., and finishing the border wall, but until they do, Republicans have a simple math problem and a political problem: How to count to 51 and how to keep their promises to extend and expand the Trump tax cuts, … secure the border wall, and incentivize U.S. production. If more spending cuts are needed, then put them in there. If more tax relief is needed, put that in there. Whatever it takes. If Republicans keep their promises, the economy will be in a solid growth position, and then Congress can get to work on better prioritizing U.S. tax dollars via the debt ceiling if necessary and of course appropriations. The American people do not want to raise taxes to pay for our unsustainable $36 trillion in debt. The way not to become a debt slave is to lower taxes and urge government to do more with less.            

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Robert Romano is the executive director of Americans for Limited Government, a conservative 501(c)(4) nonprofit organization that says it is dedicated to restoring constitutionally limited government, allowing individuals to pursue life, liberty, and happiness.