During the 2016 campaign, President Donald Trump said he'd be able to wipe out the national debt in eight years. Instead, after three years in office, he's overseen a nearly 50 percent increase in the gap between how much the government takes in and how much it spends.
The Treasury Department announced Friday that the official federal deficit for fiscal year 2019, which ended in September, was $984 billion—in line with what the Congressional Budget Office (CBO) estimated last month. The announcement serves as official confirmation that the federal government's mountain of red ink has grown dramatically during Trump's first three years in the White House. It is now approaching levels not seen since the early Obama years.
The deficit is growing despite growth in tax revenues. The Treasury Department reported that corporate tax revenue was up 12 percent over the previous year, while overall tax receipts rose by about 4 percent. But spending grew by 8 percent.
In a statement, Treasury Secretary Steve Mnuchin said the data showed "President Trump's economic agenda is working"; he also touted the low unemployment rate and ongoing economic growth. He added a boilerplate call for cutting "wasteful and irresponsible spending."
What's really irresponsible is spending growth that's outpacing revenue growth by a rate of 2-to-1. Trump's defenders will point out that he's not solely responsible for setting the government's budget. That's true, but he has the final say on all spending bills and he has been refusing to force the spending cuts Mnuchin says are necessary.
When Congress passed a bipartisan budget plan in March 2017 that annihilated Obama-era spending caps, Trump begrudgingly signed the bill while promising that he'd never agree to another spending hike like that. Earlier this year, when Congress passed another budget-busting spending bill, Trump signed it without so much as expressing a second thought.
Perhaps nothing demonstrates Republicans' complete abdication of fiscal conservatism as much as this: In three years in office, Trump has added more to the national debt than President George W. Bush did in his entire two terms. (Though Bush did have the advantage of starting out with a budget surplus in his first year.)
Bush was no tightwad. In the early Obama era, it was not uncommon to hear Republicans admit that Bush's spendthrift ways had paved the way for worse. Now, on an annual basis, Trump's deficit spending is nearly as bad a Obama's was over two terms.
Give Trump a few more years and I'm sure he'll surpass Obama. That's because the nature of the current budget deficit is fundamentally different from the peaks of the early 2010s. Those deficits eventually tapered off for a variety of reasons. Recovery from the Great Recession boosted tax revenue. The spending binge approved in response to the recession faded away. And fiscally prudent Republicans imposed some modest caps on future spending growth.
Now? The country is running a massive (and growing) deficit despite a decade of economic growth and a low unemployment rate. "Higher outlays for Medicare, Social Security, Defense, and interest on the public debt" drove the deficit increase in fiscal year 2019, the Treasury Department says.
The current deficit isn't the result of temporary circumstances like World War II or a major recession. It's a systemic deficit, a result of poor budgeting and bad decision-making by members of Congress and the current administration. It's not going to resolve itself, and it's on pace to get much worse. The Government Accountability Office (GAO) has called the federal government's current fiscal situation "unsustainable," and the CBO expects the national debt to hit "unprecedented levels" in the coming decades, well above the record highs set during World War II.
"A deficit of this size following the longest span of economic growth in history shows just how reckless our leaders have become. This is exactly the time when deficits should be contracting, not expanding," Leon Panetta, co-chairman of the Committee for a Responsible Federal Budget, said in a statement. "But instead of getting our fiscal house in order and preparing for the next downturn, our leaders continue to binge on debt-fueled tax cuts and spending hikes rather than showing the leadership necessary to set our fiscal path."
And there is no almost no interest in either major party in cutting spending or balancing the federal budget.
Democrats have abandoned all pretense of caring about the national debt, or even attempting to explain how they might pay for new federal programs. And Republicans seem capable of offering nothing more than obviously false promises and empty rhetoric.