Tax cuts and tariffs were on the docket for Scott Bessent’s confirmation hearing.
Nominee for secretary of the Department of the Treasury Scott Bessent has vowed that when President-elect Donald Trump returns to the White House, he will unleash “a new economic golden age.”
Bessent, a billionaire hedge fund manager, appeared before the Senate Finance Committee for his confirmation hearing in Washington on Jan. 16. Democrats asked questions about tax policy, tariffs, and other pressing economic issues.
“As President Trump has said, we will unleash the American economy by implementing pro-growth regulatory policies, reducing taxes, and unleashing American energy production,” Bessent told lawmakers.
Here are five key takeaways from the hearing:
1. Trump Tax Cuts
The 2017 Tax Cuts and Jobs Act (TCJA) was a key subject for senators at the Jan. 16 hearing. Over the coming weeks, Congress will debate whether to extend the Trump-era tax cuts or let them expire.
The incoming administration’s chief economic priority would be keeping the TCJA intact. Not doing so would cause “an economic calamity,” according to Bessent.
“If we do not fix these tax cuts, if we do not renew and extend, then we will be facing an economic calamity, and as always, with financial instability that falls on the middle- and working-class people.
“We will see a gigantic middle-class tax increase. We will see the child tax credit halved. We will see the deductions halved … it has the potential for a sudden stop.”
The senators presented differing views on the TCJA’s effects.
Democrats noted that the tax policy was heavily skewed toward the wealthy.
“That has burdened the American people with another $2 trillion of debt that their kids and grandkids are going to have to pay back,” Sen. Michael Bennet (D-Colo.) said. “Despite the conversation we’ve heard over here, clearly, you know the distribution shows it was deeply, deeply, deeply unfair.”
Bessent disagreed with this categorization, saying the share of taxes paid by the wealthy increased after the TCJA’s implementation. Working families registered real (inflation-adjusted) wage gains in 2018 and 2019.
According to Bureau of Labor Statistics data, real hourly compensation rose about 5 percent during these two years.
By Andrew Moran
