Jobs Report Proves Trump’s Point About ‘Too-Late’ Powell

Friday’s jobs report and the dramatic downward revisions to the past two jobs reports are the clearest proof yet that the Federal Reserve has held interest rates too high for too long. They prove President Trump’s point about “Too Late” Powell.

It’s obvious that the biggest threat to the economy is no longer inflation, which Trump and Congressional Republicans have conquered, but rather the lack of access to credit for small business job creators.

Due to the Fed’s high interest rates, the nation’s job creators can’t take advantage of the historic tax cuts that took effect last month and are operating with one hand tied behind their backs.

JCN polling shows small businesses plan to take advantage of tax cuts, including restored and permanent 100% immediate expensing, by expanding and hiring. Unfortunately, high interest rates are preventing too many of them from doing so.

“I have been turned down by several small to mid-sized banks,” said Gerald Williams, a California hot-sauce entrepreneur, who was looking for a $50,000 loan to grow his business and buy a commercial kitchen. “The process of looking for a loan has been so frustrating that I have just given up on it,” said Shantell Chambliss, a Virginia small business owner who had been trying to get a $25,000 loan.

According to a Goldman Sachs survey from last year, 79% of small business owners said it was difficult to access credit, and 28% reported that the loans they were able to obtain came with predatory payment terms.

Rather than being data-dependent, Fed Chairman Jerome Powell has become a data denier. He should immediately admit his mistake and cut rates to stimulate the Main Street economy. JCN has launched a petition to stand up for American small businesses and workers and call on the Fed to reduce rates at CutTheRateNow.com.

That said, the labor market is stronger than topline numbers suggest. Unproductive federal government jobs continue to fall and have decreased by 84,000 under the Trump administration (not including those on paid leave).

Average annual earnings increased in real terms and were higher than expectations. What’s more, this income boost doesn’t take into account the substantial raises in workers’ take-home pay due to new tax breaks on tips and overtime that took effect last month.

The mainstream media has been almost silent on just how much hardworking Americans can save from these tax breaks, hiding behind a widely cited average of around $1,700 per year. In fact, many workers will save far more than that.

Here are the details: Tipped workers earning less than $150,000 can write off $25,000 of tipped income. That means successful tipped workers taxed at the 24% marginal rate can save $6,000 annually. Families earning under $300,000 can also write off $25,000 of overtime income, also saving up to $6,000 per year.

These significant savings can cover monthly car payments, annual property tax bills, or even groceries. They allow some of the hardest-working Americans to keep more of their own money to improve their living standards.

These millions of workers must remember who to thank for their increased funds: President Trump and Congressional Republicans. Not one Democrat voted in favor of these tax savings.

Unfortunately, the Fed is working at cross purposes with Republican policymakers trying to unleash growth. It’s past time to align fiscal and monetary policy to benefit small businesses, workers, and the American economy.

Alfredo Ortiz is CEO of Job Creators Network, author of “The Real Race Revolutionaries,” and co-host of the Main Street Matters podcast.