Stock traders are preparing themselves for some bad news from DC. Later today, we should find out if the House can deliver on Ways and Means Committee Chairman Kevin Brady’s promise to hold a vote on Friday on the House version of tax reform. The Senate is also expected to issue its own version of a tax bill today. Reports say the Senate bill looks nothing like the House version. If so, that will make it even more difficult to complete the process by year-end.
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We will find out today if we're being set up for a delay in the tax bill until 2018. A delay in the bill would be a market disappointment, but the damage should be minimal. In fact, from an economic perspective I would not mind seeing the bill delayed even more. Currently, the U.S. economy is not in need of stimulus measures. Rather, I would like to see those saved for a time when the economy really does need a boost. But members of Congress will have to have something to show the voters a year from now, so eventually we’ll get something.
It might not come before year-end, it might not be a great bill, but it will come.
Dwight Johnston is the chief economist of the California and Nevada Credit Union Leagues and president of Dwight Johnston Economics. He is the author of a popular commentary site and is a frequent speaker at credit union board planning sessions and industry conferences.