If you're one of the perhaps 100 million people who tuned in to Monday night's debate, you might have a few questions about the terminology the candidates brought up. Somebody certainly did: visits to our definition of NAFTA surged by 1,636% Monday, and other key words saw similar surges in attention. We thought it might be nice to save you some effort, so here are the answers to your burning debate questions, all in one place (in case you missed it, or couldn't bear to watch, here's a run-down.)
The North American Free Trade Agreement (NAFTA) got a lot of play Monday night. Trump mentioned the deal, which Bill Clinton signed into law in 1993, by name seven times; Hillary, who is aware of the pact's lightning-rod status, did not use the acronym once. The deal eliminated most tariffs between the U.S., Canada and Mexico. The jury is out on the deal's net effects (see, Pros and Cons of NAFTA), which are hard to isolate from other, arguably more important developments that have taken place on the continent and globally in the past quarter century. Trade among the signatory countries has increased, and their economies have grown since the 90s. But for those whose employers have relocated to Mexico, the deal has had an immediate, visceral impact. And for those skeptical of globalization generally, NAFTA epitomizes the wheeling and dealing of a callous, self-centered transnational elite.
You may also want to check out the Trans-Pacific Partnership (TPP), a controversial proposed deal linking Pacific Rim economies that formed a key part of Clinton's "pivot" to Asia as Secretary of State, but which she now opposes.
2. Trickle-Down Economics
Clinton's "Trumped-up trickle-down" line didn't appear to land quite the way she would have liked – either time. "Trickle-down economics" is a generally disparaging reference to policies that favor wealthy individuals and big business on the theory that they are better positioned to jump-start growth that will benefit everybody. The populist Democrat William Jennings Bryan used a similar metaphor in the 1890s – "there are those who believe that if you just legislate to make the well-to-do prosperous, that their prosperity will leak through on those below" – but "trickle-down" was supposedly coined by humorist Will Rodgers during the Great Depression. Critics have since applied it to Reagan, George W. Bush, and other tax-cutting Republicans. Fans of the theory prefer terms such as supply-side economics.
Hillary Clinton blamed trickle-down approaches for the financial crisis Monday, saying, "Trickle-down did not work. It got us into the mess we were in, in 2008 and 2009. Slashing taxes on the wealthy hasn't worked." To add a bit of context to that claim, see 2007-2008 Financial Crisis in Review.
3. Carried Interest
Carried interest got just one mention Monday night, when Trump said he's "getting rid of the carried interest provision." Still, this little corner of the tax code carries a lot of interest and has generated some heated debates. It refers to the portion of private equity and hedge fund profits that go towards compensating general partners. To some that sounds like income, particularly since the fund managers did not necessarily contribute any of the initial capital. But carried interest is taxed at the lower capital gains rate, creating a loophole that critics say unfairly favors Master of the Universe types. (See also: What You Need to Know About Capital Gains and Taxes.)
4. National Debt
It will probably come as no surprise that the federal government owes a truly gargantuan amount of money – around $19.5 trillion, with $14 trillion held by the public. No one necessarily regards this situation as desirable, but the Republican party in particular houses a fiscally hawkish wing that finds Democrats – and the Obama administration in particular – scandalously willing to borrow and spend taxpayer money. Trump echoed these criticisms: "The Obama administration, from the time they've come in, is over 230 years' worth of debt, and he's topped it. He's doubled it in a course of almost eight years, seven-and-a-half years, to be semi-exact." (See also: What the National Debt Means to You.)
Yet as Clinton pointed out, Trump has apparently advocated renegotiating the U.S.'s sovereign debt. Trump denied saying any such thing; his statements on the matter are unclear and frequently contradictory, but appear to leave the door open to paying back less than 100 cents on the dollar. (See here for background on the sources of the national debt.)
In addition, independent experts generally see Trump's tax plan raising the national debt. The Committee for a Responsible Federal Budget estimated that his plan would cause the national debt to swell to 105% of GDP in 2026. Clinton’s plan would cause it to rise to 86%. Under Clinton, the deficit would expand by $0.2 trillion over the same period, while under Trump it would expand by $5.3 trillion.
According to the conservative Tax Foundation, Trump’s tax plan would reduce federal revenues by $4.4 trillion to $5.9 trillion over the next decade, without accounting for their effect on GDP. Given a forecast of 6.9% to 8.2% additional GDP growth and an expanded tax base, the think tank estimates that government revenues will fall by $2.6 trillion to $3.9 trillion.
5. Trump's Wealth
Finally, questions continue to swirl around Trump's business empire. How did he get so rich? Exactly how rich is he? What companies does he own? What about all those bankruptcies? And of course, can he really win?