ALEX BRUMMER: Trump’s tax cut would benefit Elon Musk and Jeff Bezos more than working people

Arriving in Austin, the capital of the state of Texas, the main arteries between the airport and downtown were closed.

Former President Donald Trump was in town and the roads were closed for safety reasons.

Trump’s main reason for being in Austin was an interview on Joe Rogan’s podcast, which has 33 million listeners and subscribers.

It’s one of America’s most popular, with quirky guests, some with an anti-vax agenda. Social media and podcasts will have a huge impact on voters in 2024.

However, rallies still remain an important part of the American political landscape and Trump also took the opportunity to hold a campaign event in Austin, a Democratic enclave, and also in Houston.

Texas, largely Republican, is not a swing state in presidential elections. Jimmy Carter was the last Democrat to win in the state, way back in 1976.

But it’s impossible to ignore the nation’s fastest-growing city, Austin, and Texas, the US’s second-largest economic power after California.

Also crucial in Texas is the tight battle for the US Senate, with Congressman Colin Allred, a former American professional footballer, giving right-wing incumbent Senator Ted Cruz a run for his money.

As a result, Democratic candidate Kamala Harris felt it was important to make a parallel appearance in Houston with glittering pop icon Beyonce by her side.

Austin is the adopted home of Elon Musk and Tesla, has a huge Google presence and is home to Dell. That’s before taking into account oil and natural gas extraction in the Texas Permian Basin, home of fracking.

The state is also the surprise leader in U.S. onshore wind farms, which power much of the state’s electricity. Note to Keir Starmer. It is perfectly possible to use carbon-free and fossil fuel technologies in the same geography.

Americans go to the polls on November 5, less than a week after Labor’s long-awaited first budget, and the financial world is on edge. The US, unlike most other rich economies in the Group of Seven, is doing fine.

The latest IMF forecast, published last week, raises US growth to 2.8% this year. So much for fears in August that the mighty, tech-driven US economy was heading for recession. Next year production is expected to increase by 2.2 percent.

Inflation is falling towards the 2 percent target and the US central bank, the Federal Reserve, cut its key interest rate by half a percentage point in September to a range of 4.75 percent to 5 percent, with further cuts in the far off. All this should help Vice President Harris in her efforts to succeed Joe Biden in the top job.

But despite the generally good health of the economy, Democrats are failing to capture the imagination of traditional pocketbooks.

Over the weekend I went to a performance by the bluegrass group Strawberry Flats at a craft cider company on the outskirts of Austin. A newly written song, The Beggars Union, was released about the issue of inflation.

The consumer price index may be falling, but for ordinary people the scars of the cost of living still live on. The song was greeted with loud applause and shouts of approval by the audience.

You begin to understand why Trump’s message of bringing jobs back home by imposing tariffs and cutting taxes has some traction.

The reality is quite different. Trump’s proposal for a 60 percent U.S. tariff on imports from China and a 10 percent U.S. tariff on goods from all other economies would essentially be a tax on ordinary Americans, triggering a new round of inflation.

British think tank NIESR estimates that such a move could reduce U.S. output by 5% over the next five years.

As for Trump’s tax cut, it would benefit Elon Musk and Jeff Bezos more than working people.

The polls show that the presidential candidates were neck and neck. At the IMF’s annual meeting last week, almost every policymaker, including Bank of England Governor Andrew Bailey, cited geopolitics and the Middle East in particular as the biggest threat to global stability. Nevertheless, the oil price remains relatively stable.

The real unspoken fear was about a second Trump term, beggar-thy-neighbor trade policies, trade fragmentation and a soft landing that will become much more difficult.