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President Donald Trump's tax cuts have exploded the federal budget deficit according to a new report issued by the non-partisan Congressional Budget Office.
Federal deficit jumps 20 percent after Trump tax cuts, spending bill: CBO report https://t.co/JOqFEkZ04r https://t.co/6iSyonrYoB— The Hill (@The Hill) 1533752703.0
The CBO released its findings on Wednesday that the Tax Cuts & Jobs Act combined with increased spending will drive the deficit up to $793 billion by the end of 2018 and will push it to $1 trillion next year - a 20 percent increase over 2017's $666 billion deficit.
@Jamesh1z1PS4 @thehill The budget deficit is set to go over 1 trillion for the first time EVER under Trump. So try again...— Wcorbe (@Wcorbe) 1533689814.0
CBO projected a deficit in fiscal year 2018 of $793 billion, outlays of $4.1 trillion, and receipts of $3.3 trillion.
This is because the federal government borrowed $116 billion more this year than it did last year.
The Long-Term Budget Outlook Under Alternative Scenarios for Fiscal Policy https://t.co/4a9aermfmr— U.S. CBO (@U.S. CBO) 1533751273.0
The deficit in 2016 was $587 billion and increased to $666 billion in 2017, Trump's first year in office.
The rest of the report is bleak.
The CBO projected that if the federal government continues to be starved of revenue, absent spending cuts to offset lower tax rates, the United States will essentially be insolvent by the 2030s.
Assuming no major changes in the tax code or in federal spending, "federal debt held by the public rises from an amount equal to 78 percent of GDP in 2018 to 118 percent of GDP in 2038."
The CBO said that if tax rates remain the same through 2026, "federal debt would equal 148 percent of GDP in 2038 and continue to rise in later years."
If tax rates are again lowered after 2028 and revenue decreases compared to GDP, "debt would equal 151 percent of GDP in 2038 and keep rising thereafter."
Most alarmingly is the CBO's projection of the effect of another tax cut "after 2018," which calculated that the "debt would equal 165 percent of GDP in 2038 and keep rising."
In 30 years, the CBO projects, servicing the national debt will become the government's largest expenditure, surpassing Social Security and defense - and that's only on the interest.
Additionally, the CBO said that unchecked borrowing is "increasing the likelihood of a fiscal crisis—a situation in which the interest rate on federal debt rise abruptly, dramatically increasing the cost of government borrowing."
Granted, the economy grew by an impressive 4.1 percent in Q2 of 2018, however, growth would have to be much higher to reduce the deficit, the CBO said.
Is this how you #MAGA? Twitter wondered.
@thehill The Hill: Is this MAGA, folks? Federal deficit jumps by 20%? And, guess where they’ll get the $$$ to offse… https://t.co/DUgiB9T9D4— Victoria Collazo (@Victoria Collazo) 1533766866.0
Concerned citizens on social media were quick to ask why Republicans, who claim to be debt and deficit hawks, seem unconcerned over the nation's ballooning debt and deficit.
"Hello?" GOP? Nothing?
@thehill I seem to remember Rs willing to shut down the govt over deficit issues. Hello?— Donna Marie (@Donna Marie) 1533752783.0
@thehill @TJSeraphim Paul Ryan, the deficit hawk, leaves a legacy of hypocracy and monumental national debt.— Jersey Swamp (@Jersey Swamp) 1533741324.0
@thehill Waiting for the Tea Party protests about our deficit climbing and saddling our children with debt. Or was… https://t.co/sJHCcjwwVO— Royal Priest (@Royal Priest) 1533739704.0
@thehill Big surprise. Where are all the GOP deficit hawks NOW, huh?— Anne Donovan (@Anne Donovan) 1533739679.0
It's like the 2000's all over again - and we remember how that went.
@thehill First rule of a GOP led deficit is we don’t talk about a GOP led deficit. @RandPaul #Hypocrisy— Markydo (@Markydo) 1533743376.0
@thehill @hrcsupervol01 But the Deficits,@GOP touted in the 1990s. #GWBush took a surplus & crashed the US Econ in… https://t.co/AaBVUepRt1— Mary Frank (@Mary Frank) 1533739869.0
Trump gets the blame because he's the president. And because he said his tax cuts would reduce the deficit.
@realDonaldTrump The Hill: “Federal deficit jumps 20% after GOP tax law. tRump argued that the tax cuts would bring… https://t.co/co3DU479AG— Navyshellback75 (@Navyshellback75) 1533741022.0
@thehill Once again, @realDonaldTrump and the @GOP are taking America into the abyss of debt and deficits. This cos… https://t.co/VtnGZm7qPc— Michael Rich (@Michael Rich) 1533740294.0
Of course, there is one possibility...
@thehill Deficits don't matter, unless there is a Democrat in the White House.— H.G. (@H.G.) 1533739597.0
@thehill @SpeakerRyan where's the outrage Mr. Speaker? I guess deficits only matter when there is a black man in office???— Erik Griffis (@Erik Griffis) 1533739554.0
Nailed it.