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A new Congressional Budget Office (C.B.O.) Report is out and the numbers are staggering. The agency, which acts as an independent federal watchdog, is upping its projections for this year's federal deficit by $63 billion and increasing its forecast for deficits over the next decade by $809 billion. This means the deficit is set to rise 25% from last year and will approach one trillion dollars by next year.
“The nation’s fiscal outlook is challenging. Federal debt, which is already high by historical standards, is on an unsustainable course, projected to rise even higher after 2029 because of the aging of the population, growth in per capita spending on health care, and rising interest costs. To put it on a sustainable course, lawmakers will have to make significant changes to tax and spending policies—making revenues larger than they would be under current law, reducing spending below projected amounts, or adopting some combination of those approaches.” — statement from CBO Director Phillip Swagel
Despite all of the hype from Republicans for Trump’s new tax cuts, projected tax revenue is now $430 billion below the projections that helped to sell the law. Take a moment for that one — Republicans used the projected revenue that the Trump tax cut was supposed to yield to justify their increased spending all the while knowing it would likely not pan out. The result is an increased spending of $1.9 trillion over the next ten years. This is a direct consequence of the new budget deal this year and the new spending obligations taken on by the GOP.
The deficit made up 2.4% of the GDP (Gross Domestic Product) in 2015 under President Obama, but that will shoot up to 4.7% over the next decade under this Republican majority. The hypocrisy from Republicans given their excessive spending now is staggering considering the flack Obama took for attempting to stimulate the economy with spending-a plan that actually worked. Trump has proposed a higher deficit and more spending this year than back when he criticized Obama in the tweet below. Donald Trump accused President Obama of possibly leading us into bankruptcy and only a few years later, the bankruptcy king himself is actually doing that very thing.
The federal debt held by the public is expected to grow from 79% of GDP in 2019 to 95% of GDP in 2029, which represents the highest level of debt incurred since the end of World War II. The CBO also concludes that federal debt is on an unsustainable course and will rise even higher after 2029, because of the aging population, growth in health care and rising interest costs. These higher projections come even as the CBO reduced its projections for interest rates, which lowers borrowing costs, and as it raised projections for economic growth in the near term. Considering that consumer spending is driving the stability of the U.S. economy currently and given the volatility created by erratic trade plans, this is truly alarming.
“The recent budget deal was a budget buster, and now we have further proof…As these new numbers come out, let’s hope at least the same lawmakers who voted for these reckless policies spare us the act of pretending they’re shocked and surprised by the dangerous path we are now on…Fortunately, it’s still not too late to make things right. As a first step, policymakers should pledge to pay for all extensions of existing policies and new legislation so we can put an end to this downward fiscal spiral. They should also redouble their efforts to control health care cost growth, restore Social Security solvency, and gradually bring revenue and spending more closely in line rather than further apart. — statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget
If all of these numbers give you a headache and make you want to tune-out, you are not alone. Writing this was not fun either, but the takeaways here are too important to overlook. Republicans are spending at a record level, despite claiming to be the party of fiscal conservatism and the projected numbers under the Trump tax plan that justified increased spending were a lie. A lot of us knew that going in, but this latest report confirms it. It’s critical that people understand the essential need to regain control of this run away spending, because we’re running out of time to turn things around. This is the kind of information we need to be discussing with others all the time to help increase voter turnout in 2020.
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Amee Vanderpool writes the “Shero” Newsletter and is an attorney, contributor to Playboy Magazine, analyst for BBC radio and Director of The Inanna Project. She can be reached at email@example.com or follow her on Twitter @girlsreallyrule.