Today, I’d like to share the results of the most impactful – and hopefully the last – trickle-down law this country enacted: Trump’s tax cuts in 2017.

This Trump/GOP tax legislation handed hundreds of billions of dollars in tax cuts to America's wealthiest people and corporations under the flimsy premise that their economic benefits would somehow translate to economic benefits for everyone else. It didn't work, of course. 

The $4,000 annual raise that former House Speaker Paul Ryan promised American households would see in the form of higher wages never materialized, and the law didn’t cause economic growth. The Trump tax cuts didn't increase investments in American businesses – in fact, the wealth created for the richest Americans from those tax cuts likely wound up overseas. 

These are the typical trickle-down failures we’ve seen time and again, but there was one part of this legislation that was unique: One provision within this tax legislation allowed wealthy corporations to claim a tax cut for investing in lower-income and underserved areas called “opportunity zones.” The idea was that these investments would help stimulate local economies – so let’s take a look at how that plan turned out.

A recent investigation into 2019 records found that wealthy Americans and corporations only invested in about 16% of the existing opportunity zones. The majority of zones that received any funds were neighborhoods with preexisting upward trends in population, income, and home values, and declining shares of elderly and nonwhite residents.

In other words, the opportunity zone program didn’t improve the nonwhite communities that have been ignored by politicians and business leaders for generations. Instead, this program created a huge flow of untaxed money into a handful of mostly white, wealthy communities – and big corporations got a huge capital gains tax break as the cherry on top.

The Trump tax cuts could serve as a watershed moment for trickle-down economics precisely because they prove the fallacy at the heart of the idea that rich people are the true job creators. 

For the first time in 40 years, mainstream politicians are talking seriously about investing broadly in the American people through programs like affordable child care, paid family leave, and worker-friendly laws like increased overtime thresholds and higher minimum wages. If they follow through on their promises, they could finally release trickle-down's hold on the economy.

To spread the word about the failure of trickle-down economics, I wrote about Trump’s disastrous tax cuts in Business Insider. Will you share my article with a friend to help Civic Action bust trickle-down myths? 

Thank you for reading, 

Paul Constant
Team Civic Action