Local businessmen laud Trump victory

Economists predict the election of Donald Trump as the next president of the United States will have significant impact on local business and retail for years to come.

Trump has proposed instituting a special 15 percent tax rate on business income claimed on individual tax returns, known as “pass-through” income. His proposal would cut taxes at all income levels, although the largest benefits — in dollars and percentage terms — would go to the richest households, according to the Tax Policy Center.

Locally, some business owners said Trump’s victory is a “success.” Gregory Knox of Knox Machinery in Franklin said Trump’s plans to dismantle the Affordable Care Act will lower costs for employee healthcare and could benefit his company’s financial stability in other ways.

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“I’m relieved and I’m happy,” Knox said. “I think both candidates were pretty much equally flawed. A lot of the campaign didn’t focus on what I, as a businessman, consider to be the real issues. For that reason, I think last night was a successful night for businessmen and, ultimately, for the country.”

There are critics of Trump’s plan. According to the IRS, more than two-thirds of pass-through business income flows to the top 1 percent of tax filers. Critics say Trump’s proposal would benefit mostly high-income professionals, such as doctors and lawyers in private practice.

Trump made several stops in Ohio throughout the election, including a visit to a Dayton company in September. He held a private meeting with business leaders at Staub Manufacturing Solutions, where he outlined his views on manufacturing.

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Officials from area companies questioned Trump about trade regulations, the national debt, immigration and tax reform. Trump slammed current tax regulations during the visit.

“The regulations are putting businesses out of business,” Trump said in Dayton. “We are going to be cutting massively.”

Jim Zahora, the second vice chairman of the Dayton Region Manufacturers Association, attended Trump’s Dayton visit. Zahora said Trump’s presidency could be positive for business owners.

“He had some sound, common sense ideas,” he said.

Economists have said the Trump victory — followed by brief market volatility and risk-off posturing — could also decrease the likelihood of a Fed rate hike in December.

“A Trump win could trigger uncertainty and volatility,” according to a report by Societe Generale’s Cross Asset Research team.

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Mekael Teshome, PNC regional economist, said it’s difficult to determine how his proposed policies on issues like immigration and foreign trade will impact the longterm economy.

Teshome said the nation will likely see higher inflation and deficit spending during Trump’s tenure. There will likely be little push for a minimum wage increase.

Industries like retail and healthcare could see significant impact from the change in the White House. In the healthcare sector, Trump has said he will work swiftly to “repeal Obamacare.” This could have an impact on a company like CareSource, the largest private company in downtown Dayton.

Experts say retail and shopping sales are also likely to be impacted by the election, particularly as Republicans push for tax reform on all levels.

An analysis from Morgan Stanley outlined Trump’s aggressive positions on immigration and global trade. His immigration policies could remove a large number of consumers and workers from the population, according to the analysis.

Teshome said consumer habits probably won’t change much in the short term. Holiday sales will still jump higher from previous years, according to industry estimations.

Matthew Shay, president and CEO of the National Retail Federation, said the retail industry must look forward to creating business and job growth. The industry contributes $2.6 trillion to the annual gross domestic product.

“If this election taught us anything, it is the importance of focusing on policies and programs that not only benefit today’s economy, but the economy of the future and our next generation of workers,” he said.