DAYTON, Ohio (January 2018) – So how do you think the new, recently passed federal Tax Cuts and Jobs Act (TCJA) signed into law this past December 22 and the fast-paced growth of the stock market will affect the American economy? Great? I think so.
In early December, I wrote about 2018 economy predictions in both the chamber’s quarterly magazine, Focus on Business, and for our regional television show, “Business Connections.” In them, I speculated that our regional economy would have modest growth of only about 1 – 2% this year, unless something extraordinary stimulated it … like the stock market or the corporate and personal tax reform changes.
I said that if those things happen, we may see better than the last three to five years’ average modest growth. Well, as you well know, several things have indeed occurred that should improve our national and regional economy.
First, the stock market continues to rise, which has created a lot of corporate and individual wealth (investments and retirement accounts) that both businesses and individual tax payers can use to help fuel our economy.
When I submitted this piece, the Dow Jones was just above 26,000, up over 6,000 points from a year ago, and arguably helping to create, along with other business success, close to $2 trillion in added U.S. wealth that can be reinvested into our regional and national economies.
Going forward, some economists now predict the lessening of both business and personal income tax rates through the tax reform of TCJA, which could still fuel the market and add the sweet sound of job creation to both our local and national economy.
Now, no one can really predict how long this stock market surge will continue; I surely can’t. But the reduction of taxes going forward will surely spur wealth and job growth in 2018.
If our predictions had been this modest 1 – 2% growth for the region and 2 – 3% nationally, I feel encouraged … short of an unlikely short-term recession … that the Dayton area might see more of its share of that national trend knowing our business and investor community will take advantage of some additional income that can be put back into local businesses, the marketplace … and hopefully include many of those small, local mom-and-pop retailers, restaurants and manufacturing and construction businesses who all have capital needs to grow.
2018 should possibly be better than expected, and that could be a real “shot in the arm” to our community at a time when we could well use some additional stimulation. We should all keep our fingers crossed. Growth, profits and jobs are ultimately good for us all.
To download a PDF of this article as it appeared in the Dayton Daily News, click here.
Phillip L. Parker, CAE, CCE
President & CEO
Dayton Area Chamber of Commerce