in the vicinityVideoUS of national debt, a record amount of $22 trillion
Former Republican staff director of the Senate Budget Committee, Bill Hoagland says, it would be unprecedented that the U.S. will default on its debt.
The Federal government, the budget deficit is swelling, but you don’t hear much about it in DC
This year the deficit is forecast by the Treasury Department, more than $ 1 trillion, an increase of $779 billion in the past year. The US national debt exceeds $22 trillion U.S. dollars.
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“To give something,” Maya MacGuineas, President of the Committee for a Responsible Federal budget, told Fox News. “No one wants more money for interest payments than for children or defense, but this is the way we are at the moment.”
Four years ago, when a number of Republicans were running for President, then-candidate Donald Trump was among those calling for urgent action, namely the budget deficits: “We are bringing big league, and quickly.”
But Trump, as President, deficits have grown: Through the first eight months of this budget year, the budget deficit totals $738.6 billion, an increase of 38.8 percent compared to the same period last year.
Among the reasons for the deficit: the Trump-backed $1.5 trillion tax cut in 2017, and the significant increases in spending for the military and domestic programs passed by Congress in the year 2018.
“It’s unprecedented to have a deficit this high, when the economy is good,” MacGuineas. “Half of this year’s deficit, driven by laws, by the last Congress and signed into law by the President. The tax cuts pay for themselves, not even close. Congress to lower taxes and pay for it with one hand, the increase in spending with the other, and asked the next generation for both of them.”
Polling shows voters in both parties remain concerned about the debt-but neither the Republicans nor the Democrats seem to emphasize the deficit a lot, which is always an anti-austerity era. Not only does the topic merit a massive and expensive new government run most of the attention in Washington, but on the 2020 presidential election campaign of the Democratic candidates are promising programs such as “Medicare for All”, the “Green New Deal”, or student loan forgiveness-which could swell the deficits even more, with estimates in the trillions.
Democratic candidates for raising taxes on the rich, though. The former Vice-President Joe Biden said on Monday, “The first thing I would do is to eliminate as President of the President of the tax reduction.”
“No one wants more money for interest payments than for children or defense, but this is the way we are at the moment.”
— Maya MacGuineas, President of the Committee for a Responsible Federal budget
The Republicans, meanwhile, apparently not so enthusiastic about spending cuts, as they once were, if you are asked about the deficit. In a panel discussion, hosted by the Peter G. Peterson Foundation, White House Chief of Staff Mick Mulvaney – who developed a reputation as a budget hawk, while a GOP-Congressman – stated flatly “we are not cutting our way to balance,” citing the divided political environment.
“Show me the majority in the house to vote to cut spending,” said Mulvaney last week. “Show me the 60 vote majority in the Senate to cut spending. This is not going to happen.”
Instead, Mulvaney hope expressed, a dent in the deficit can be reduced by economic growth and the reduction of the rate of expenditure, namely, the administration would like to “grow our revenues faster than costs.” But the Committee for a Responsible Federal budget has argued, it would be “unprecedented” 4.8 percent average growth over the next 10 years to balance the budget, through higher economic growth alone.
Not going to cut it “we are on our way to balance,” White House chief of staff Mick Mulvaney said during a recent panel discussion. (AP Photo/Evan Vucci, File)
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Others went about the country, the debts have warned that the deficit will never be resolved until changes are made to entitlement programs such as Social Security and Medicare – something Trump has no interest in the prosecution.
“Unless an essential claim of the reforms implemented now, before America is the fiscal situation to be dangerous, the only option available to the legislature could drastically increase taxes, government services cut, or both,” wrote Justin bogie, senior policy analyst at the conservative Heritage Foundation.
The Congress and the White house in front of some looming battles on the budget in the coming months: you need to come to an agreement over-spending bill by Oct. 1 to prevent a government shutdown. There is also the risk of default if the Congress will increase the country’s debt brake this fall.
The Associated Press contributed to this report.