Trump’s budget reverses GOP dogma
US media, the plan would add $984 billion to the federal deficit next year, contrary to Trump’s promise of a balanced fiscal strategy.
The White House has said the lost revenue due to tax cuts would be made up for by the booming economy, an assumption that is falling short of expectations.
Trump’s plan promises 3 percent growth for the economy, continuing low inflation and low interest yields on US Treasury bills despite a flood of new borrowing. That likely underestimates the mounting cost of financing the government’s $20 trillion-plus debt, many economists say.
The US federal budget is proposed by the executive branch and approved by Congress, but a split Congress has resulted in an inability to pass annual budgets on time, causing repeated government shutdowns in past weeks.
Adding to US financial woes, increasing expenditure together with stagnant revenue has created hundreds of billions of dollars in deficit each year, burdening the US economy with heavy debt.
The open embrace of red ink is a remarkable public reversal for Trump and his party, which spent years objecting to President Barack Obama’s increased spending during the depths of the Great Recession.
Rhetoric aside, however, Trump’s pattern is in line with past Republican presidents who have overseen spikes in deficits as they simultaneously increased military spending and cut taxes.
“We’re going to have the strongest military we’ve ever had, by far,” Trump said in the Oval Office on Monday. “In this budget we took care of the military like it’s never been taken care of before.”
There was immediate opposition from Democrats and some Republicans, who said spending was much too high.
“The Trump budget proposal makes clear his desire to enact massive cuts to health care, anti-poverty programs and investments in economic growth to blunt the deficit-exploding impact of his tax cuts for millionaires and corporations,” said Representative John Yarmuth, the top Democrat on the House Budget Committee.
“This budget continues too much of Washington’s wasteful spending it does not balance in ten years, and it creates a deficit of over a trillion dollars next year,” added Republican Representative Matt Gaetz. “We cannot steal from America’s future to pay for spending today.”