MENU

Reason.com

Free Minds & Free Markets

Trump's Budget Effectively Guarantees Trillion-Dollar Deficits Until 2030

Once you get past the rosy economic expectations, it's clear that Trump's budget is not a serious effort at fiscal restraint.

Officially, President Donald Trump's proposed budget would add an estimated $7.9 trillion to the national debt over the next 10 years, even as annual deficits are projected to decline after hitting a high of $1.1 trillion in 2020.

But as I wrote earlier this week, the White House's offical projections for future deficits are predicated on some suspiciously generous estimates about future economic growth. Most economists, like those at the Federal Reserve, expect the U.S. economy to grow by about 2 percent annually for the next decade—but the Trump budget projects 3 percent growth. That sounds like a small difference, but one that inflates future federal government revenue by 9 percent over ten years, which makes the budget appear closer to being balanced than it might actually be.

A more conservative estimate of future revenue growth is offered by the Congressional Budget Office (CBO), which expects just 1.8 percent growth on average over the next decade. While the CBO has not yet issued an official assessment of Trump's new budget plan, the fiscal hawks at the Committee for a Responsible Federal Budget (CRFB) have taken the CBO's growth projections and applied them to Trump's budget.

The result? Trillion-dollar deficits as far as the eye can see.

Source: Committee for a Responsible Federal BudgetSource: Committee for a Responsible Federal Budget

"Thus, instead of putting debt on a downward path, the budget would result in debt rising throughout the next ten years, though at a slower pace than current law," the CRFB concludes.

All these projections are merely educated guesses, of course, and a bad recession could easily make all of them look foolish—all the more reason to be conservative in guesses about future economic growth.

Slowing the growth of the national debt is important, but with the federal government aready $22 trillion in the hole, a budget that doesn't balance for more than a decade is taking us in the wrong direction. If history is any guide, Congress will likely discard much of the president's budget and increase spending across the board anyway—which is why the president should propose serious fiscal restraint as a starting point for negotiations. Once you get past the rosy economic expectations, it's clear that Trump has not done that.

Photo Credit: Keegan Barber/ZUMA Press/Newscom

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • loveconstitution1789||

    Good thing Congress will ignore Trump budget cuts and spend far more.

  • colorblindkid||

    One more time for the kids in the back:

    THE PRESIDENTIAL BUDGET IS MEANINGLESS.

    It does not mean anything.

    Every fucking year under every president people freak out and put out all these think pieces about a document that means absolutely fucking nothing. The president does not control the budget, and the final budget passed by Congress never looks anything remotely like the president's proposed budget.

    The entire thing is a giant waste of time. It is more meaningless of a concept than the "National popular Senate vote" and should be eliminated entirely, if only to spare us the week of inanity that follows it every year.

  • Leo Kovalensky II||

    The President's budget should set a sense of direction for the party of the President. One of his roles, even if it's unofficial, is to be the leader of his party.

    The Democrats have about 0% chance of showing much fiscal constraint when it comes to spending. Because of this, we have to hold Republicans accountable if we ever want a shot at real, meaningful spending cuts. This is especially true for a Republican President as the de facto party leader.

  • Interskeller||

    Republicans arent a fiscally responsible party. Thats just a pipe dream. What is needed is to raise taxes AND cut spending for about 20 years to get the house in order. Then we can reasses. But no one wants to do that on either side,

  • Brandybuck||

    I will never vote for anyone who doesn't promise to cut spending. Somewhere. Anywhere. Republicans are just fooling themselves by pretending to be Burkeian conservative while supporting deficits of this magnitude. I expect such stupidity out of the Democrats, but it makes no sense for a party which claims for itself the fiscally conservative banner.

  • Leo Kovalensky II||

    It's easy to claim one has principles when out of power. If you doubt that the Republican Party on the whole is utterly lacking in fiscal restraint, Trump included, after having complete control of the federal government and increasing spending during the last Congress, then you might just be a partisan hack.

  • Interskeller||

    republicans are a fiscally conservative party just like they are a party for ethics and morality. Take that anyway you want.

  • TrickyVic (old school)||

    ""It's easy to claim one has principles when out of power.""

    Former LEOs coming out against the drug war for example.

  • ChuckNorrisBeardFist||

    Can't wait for President AOC and the GND. We'll be told deficits don't matter because it's for the children.

    Horde money now...not to spend but to burn for heat!

GET REASON MAGAZINE

Get Reason's print or digital edition before it’s posted online