Americans Slash Expectations of Federal Benefits After Trump Win
(Bloomberg) -- Americans downgraded their expectations for benefits from the federal government after Donald Trump won the presidency, according to a new survey by the Federal Reserve Bank of New York.
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Anticipated increases in federal benefits were scaled back across the board in the New York Fed’s December survey of public policies, published on Monday. There were sharp declines in expectations for higher social security and unemployment payments, housing assistance, Medicare, and assistance with student debt.
Trump campaigned on a pledge to rein in federal spending, and he’s appointed Tesla chief Elon Musk to head a Department of Government Efficiency that will examine ways to save money, though it’s not yet clear where budget cuts will fall.
One example from the latest New York Fed survey is the average perceived likelihood of an expansion in paid parental leave. The share of respondents expecting an increase dropped to 15.9%, from 24.4% in August. The number who anticipate getting expanded free or subsidized public preschool over the next year slid from 34.7% to 19.8%, the lowest since at least April 2017.
The share of respondents expecting forgiveness of federal student loans, or other kinds of assistance with repayments, dropped to 17% — the lowest in the survey’s history going back to 2015.
Meanwhile a much larger share of people, and higher-income respondents in particular, said they see a smaller likelihood of increases in taxes — on income, capital gains, payrolls and gasoline — in the December survey compared with August results.
The New York Fed typically carries out the public policy survey three times a year.
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