There are roughly two months to go until the November election, which swing-state voters know all too well after a summer of relentless political advertising bombardment. Emotional and complex social and cultural issues grab most of the headlines, and when the conversation turns to the economy, inflation tends to take center stage.
Read Next: Trump Wants To Eliminate Income Taxes: Here’s What That Would Mean for the Economy and Your Wallet
For You: 9 Things You Must Do To Grow Your Wealth in 2024
But rising prices are much harder on low-income earners than those who enjoy high salaries. So, if you can buy your way out of inflationary pressures, shouldn’t income join the price of gas and groceries at the top of the national list of priorities?
GOBankingRates spoke with two economics professors about the impact that a second Trump term could have on household earnings. One based his insight on the former president’s first-term policies and record. The other’s perspective comes from his analysis of the impact — or lack of impact — that presidential elections have had on household income levels for decades before the one that America is currently racing toward.
Earning passive income doesn’t need to be difficult. You can start this week.
Dennis Shirshikov is a professor of economics, finance and accounting at the City University of New York. A longtime real estate investor, he also serves as the head of growth at the vacation property investment platform Summer. He is a regular contributor to Forbes, Time and the Wall Street Journal, and he covers how governmental policy influences personal wealth in his academic courses.
Relying on Trump’s original stint in the White House, Shirshikov predicts that any gains to household income will not be distributed evenly if the 45th president becomes the 47th.
“If Donald Trump wins the 2024 election, I anticipate that household incomes in 2025 could experience uneven growth,” he said. “Historically, Trump’s policies have favored tax cuts and deregulation, which might stimulate higher-income brackets and certain industries like real estate and finance, potentially leading to wage growth in these sectors.”
Explore More: I’m an Economist: Here’s My Prediction for the Working Class If JD Vance Is Vice President
However, Trump’s first-term record leads Shirshikov to conclude that the impact will be mixed for middle- and lower-income households.
“While tax cuts might offer some relief, the benefits could be offset by inflationary pressures or reduced government spending on social programs,” he said. “An example from his previous term showed that while the stock market and high-income earners benefited significantly, wage growth for the middle class was more modest, and income inequality widened.”
Mariano Torras is a professor of finance and economics at Adelphi University with a Ph.D. from the University of Massachusetts, Amherst. He has published articles in the Journal of Economic Issues, World Development, Ecological Economics and other prominent academic journals. He specializes in political economy, development economics, institutional economics and ecological economics.
Torras’s research and experience have not revealed a straight line between election outcomes and earnings.
“Household incomes in 2025 would have very little, if anything, to do with who wins in November,” he said. “I know that this is not a common view, but I have always maintained that the credit or blame given to the president for economic conditions is vastly exaggerated.”
While he understands that elections matter, he just doesn’t think they matter much for incomes — at least not directly.
“As important as it undoubtedly is politically who wins in November, economically, it has historically mattered little which party is in the White House,” said Torras. “It is even more true today, as a long-term secular decline in U.S. economic strength is coming to dominate the periodic ‘business cycle’ vicissitudes. The stock market is an artificial and increasingly deceptive indicator of economic strength.”
Torras expanded on his last point by saying, “Wall Street is not the economy,” meaning that the investor class has seen its incomes soar, which drags up the often-cited but deceptively rosy national average income.
“Median — as opposed to the misleading mean — household incomes have mostly been stagnant for 25 years,” he said. “Mass support for quality, benefits-paying jobs in either the public or private sectors seems the only feasible way of reversing this trend. Yet hopes for this appear unrealistic, even if either party is theoretically capable of delivering.”
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
More From GOBankingRates
This article originally appeared on GOBankingRates.com: I’m an Economist: My Prediction for Household Incomes in 2025 If Trump Wins the Election