Bud­get plan found to fall short

Northwest Arkansas Democrat-Gazette - - NATIONAL - AN­DREW TAY­LOR In­for­ma­tion for this ar­ti­cle was con­trib­uted by Josh Boak of The As­so­ci­ated Press.

WASH­ING­TON — A new gov­ern­ment anal­y­sis of Pres­i­dent Don­ald Trump’s bud­get plan says it wouldn’t come close to bal­anc­ing the fed­eral ledger like the White House has promised.

Thurs­day’s Con­gres­sional Bud­get Of­fice re­port says that Trump’s bud­get, if fol­lowed to the let­ter, would re­sult in a $720 bil­lion deficit at the end of 10 years in­stead of the slight sur­plus promised.

The bud­get of­fice said Trump’s plan would re­duce the deficit by a to­tal of $3.3 tril­lion over 10 years in­stead of the $5.6 tril­lion deficit cut promised by the White House. The non­par­ti­san score­keeper es­ti­mated that deficits in each of the com­ing 10 years will ex­ceed the $585 bil­lion in red ink posted last year.

The bud­get of­fice said that Trump re­lied on far too op­ti­mistic pre­dic­tions of eco­nomic growth and that Trump’s rosy pro­jec­tions are the chief rea­son his bud­get doesn’t bal­ance as promised.

“Nearly all of that [deficit] dif­fer­ence arises be­cause the ad­min­is­tra­tion projects higher rev­enue pro­jec­tions — stem­ming mainly from a pro­jec­tion of faster eco­nomic growth,” the of­fice said.

Trump’s bud­get pre­dicts that the U.S. econ­omy will soon ramp up to an­nual growth in gross do­mes­tic prod­uct of 3 per­cent; the bud­get of­fice’s long-term pro­jec­tions pre­dict an­nual GDP growth av­er­ag­ing 1.9 per­cent.

“The CBO re­port shows that the pres­i­dent built his bud­get on fan­tasy pro­jec­tions,” said Rep. John Yar­muth of Ken­tucky, the top Demo­crat on the House Bud­get Com­mit­tee.

Trump’s May bud­get sub­mis­sion pro­posed po­lit­i­cally un­re­al­is­tic cuts to the so­cial safety net for the poor and other do­mes­tic pro­grams. Many of its rec­om­men­da­tions were deemed dead on ar­rival and are be­ing ig­nored by Repub­li­cans con­trol­ling Congress.

The bud­get of­fice also said the Trump plan con­tained too lit­tle de­tail to ac­cu­rately pre­dict its ef­fects on the econ­omy. The White House promised that its eco­nomic pro­jec­tions will pro­duce $2.1 tril­lion in deficit re­duc­tion, mostly from over­haul­ing the tax code and re­duc­ing the bur­den reg­u­la­tions have on the econ­omy. But Trump’s tax over­haul plan so far is so vague that it can fit on a sin­gle page.

The anal­y­sis came as the ad­min­is­tra­tion and Repub­li­cans con­trol­ling the House are strug­gling to unite Repub­li­cans be­hind an al­ter­na­tive con­gres­sional bud­get plan that’s a pre­req­ui­site for a hoped-for tax over­haul ef­fort this fall.

The stakes on com­plet­ing a bud­get are high for the Trump ad­min­is­tra­tion. Bud­get Di­rec­tor Mick Mul­vaney said Thurs­day that the ad­min­is­tra­tion’s plans to cut taxes hinge on com­plet­ing a 2018 bud­get, a pro­ce­dural re­quire­ment so that the tax cuts can be passed with­out hav­ing to rely on Demo­cratic sup­port in the Se­nate.

“The tax re­form con­cepts rely al­most en­tirely on the bud­get res­o­lu­tion pass­ing,” Mul­vaney said at a break­fast with re­porters.

Mul­vaney said that dis­cus­sion con­tin­ues among House law­mak­ers about fash­ion­ing a pack­age of cuts from so-called manda­tory pro­grams that can win sup­port from both con­ser­va­tive and cen­trist Repub­li­cans.

But Mul­vaney was quick to down­play calls for an ag­gres­sive time­line on the ad­min­is­tra­tion’s agenda. He said it was un­rea­son­able to ex­pect Congress to raise the gov­ern­ment’s bor­row­ing author­ity, re­place the 2010 health in­sur­ance law and pass a 2018 bud­get in the “next cou­ple of weeks.” Mul­vaney said that the pri­or­ity is com­plet­ing the GOP’s re­write of health care first.

The Con­gres­sional Bud­get Of­fice is the non­par­ti­san score­keeper that is to of­fer law­mak­ers in­de­pen­dent anal­y­sis of leg­is­la­tion, the bud­get and the econ­omy. While the White House and many Repub­li­cans have crit­i­cized the of­fice’s cov­er­age es­ti­mates for the 2010 Af­ford­able Care Act and the House and Se­nate GOP re­place­ment plans, the White House hasn’t been crit­i­cal of its bud­get pre­dic­tions.

“While it does very well at times pre­dict­ing things on bud­get — whether it’s rev­enue or spend­ing, we don’t al­ways agree that it does a great job pre­dict­ing [health care] cov­er­age,” White House spokesman Sarah Huck­abee San­ders told re­porters last month.

On Thurs­day, the White House bud­get of­fice took heart that the Con­gres­sional Bud­get Of­fice cred­ited it with $4.2 tril­lion worth of spend­ing cuts over the next decade, in­clud­ing $1.9 tril­lion from health care pro­grams; it also says the ad­min­is­tra­tion would cut taxes by al­most $1 tril­lion over that time, mostly be­cause of its plans to re­peal the Af­ford­able Care Act.

The deficit cuts may come up short of bal­ance, but the White House noted they are still very am­bi­tious.

“We are thrilled that CBO con­firms that the pres­i­dent’s pro­posed bud­get resulted in the largest deficit re­duc­tion they have ever scored. CBO agrees that this is the largest deficit re­duc­tion pack­age in Amer­i­can his­tory,” said White House bud­get of­fice spokesman Meghan Bur­ris, promis­ing that Trump’s eco­nomic agenda “will jump-start the econ­omy.”

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