Tax cuts and spending bill leave U.S. in sea of red ink

Glen Norman
April 12, 2018

Jeff Stein, The Washington Post •.

President Donald Trump and Congressional Republicans' tax cuts and spending increases will have serious impacts on the us deficit.

The federal deficit, or the gap between how much the government takes in in revenue and how much it shells out, is expected to skyrocket 21% over last year to reach $804 billion in the fiscal 2018 year ending September.

The CBO said that "such high and rising debt would have serious negative consequences for the budget and the nation", which would include limiting the government's flexibility to introduce new policies and making it vulnerable to fiscal shock.

The timing of the balanced-budget debate - after Congress agreed to cut taxes and spend more money that will substantially grow the deficit and debt - has longtime budget hawks once again scolding lawmakers for rhetoric that does not meet reality.

While the GOP's tax cuts are a driving factor of new deficit spending, the tax cuts are also projected to boost earlier forecasts for economic growth and unemployment.

That review looked at the impact of the Trump legislation which slashed cutting taxes by $US1.5 trillion over 10 years, followed by a bill passed in March that lifts ceilings on discretionary spending over two years. "That percentage will be the largest since 1946, and well more than twice the average over the past five decades", he said.

Annual deficits topped $1 trillion from 2009 to 2012, because of greater spending on social safety net programs and economic stimulus, as well as slumping tax receipts as the economy cratered. No mention of the "voodoo economics" idea of dodgy economists that lower taxes generates higher spending and lower deficits.

"The timing of this is really concerning because we're not coming out of a recession", Hall said Monday.

Republicans controlling Washington have largely lost interest in taking on the deficit.

At 11 years, the report covers a slightly longer time period than the usual 10-year projections, but even accounting for just the first decade, the figure remains around $1.9 trillion.

Republicans and Democrats alike bemoaned the growing deficits Monday but offered opposing suggestions for how to deal with it.

Numerous Republican lawmakers in the past often decried the increasing USA debt.

"That is unacceptable", said Sen.

The bad part of all this is that Congress has already lost interest in trying to reign in spending, even though House GOP leaders have scheduled a vote this week on a proposed amendment to the Constitution to require a balanced federal budget. That plan is widely viewed as a symbolic measure with little chance of passing Congress or winning the necessary ratification from the states.

Other reports by

Discuss This Article