Highlights of the CBO's Budget and Economic Outlook

Highlights of the CBO's Budget and Economic Outlook

Highlights of the CBO's Budget and Economic Outlook

What once would have been considered unthinkable is now projected to be routine.

Republican lawmakers on Tuesday brushed aside a report from the nonpartisan Congressional Budget Office (CBO) that found their signature tax law would add $1.9 trillion to deficits by 2028.

For much of the same reason, other independent analysts, such as the Committee for a Responsible Federal Budget, are already saying the deficit could push toward (or even past) the $2 trillion threshold by the end of the 2020s.

The CBO released analysis Monday detailing how the federal budget deficit will be $804 billion in 2018 and exceed $1 trillion in 2020.

"The largest effects on GDP over the decade stem from the tax act", according to the CBO.

"This high and rising debt matters because it harms our economy, by crowding out public and private investment, reducing our fiscal flexibility, and lowering confidence and certainty". It predicts that government debt held by the public will swell to almost 100% of U.S. gross domestic product at the end of the 2020s.

Over the 2018-2027 period, CBO estimates the cumulative deficit would be $1.6 trillion larger than the June projection - $11.7 trillion rather than $10.1 trillion.

Republicans and Democrats alike bemoaned the growing deficits Monday but offered opposing suggestions for how to deal with it.

The national debt, which has topped $21 trillion, is expected to soar to more than $33 trillion in 2028.

The CBO's latest projections are hardly surprising. They also warned that the policies approved by Congress and the president in recent months would dig the government into an even deeper financial hole.

The new CBO analysis projects the United States will see the federal deficit rise above $1 trillion a year within two years - earlier than had been previously expected.

There is a nightmare scenario in which borrowers lose faith in the country's ability to pay back its debts, demanding higher interest rates on their loans and setting off a spiral of larger deficits and still-higher rates.

The US hasn't run deficits exceeding a trillion dollars since 2012.

The CBO also estimated that the stimulus effect of the tax cuts will add 0.7 percent on average to the nation's economic output over the coming decade. "The American people deserve a Congress that is focused squarely on helping the middle class, not patronizing Kabuki theatre - like sham "balanced budget" votes - from Republicans who blew up the deficit to benefit wealthy special interests". "Now, during a time of low unemployment and economic expansion, we should be taking reasonable steps to put our debt on a sustainable path - but instead we are piling up trillions of bills that will harm the next generation's economic prospects and prosperity", he said.

The longer we wait, the more painful the solutions will be. Pat ToomeyPatrick (Pat) Joseph ToomeyWH backpedals on Trump's "due process" remark on guns Top GOP candidate drops out of Ohio Senate race Newly declassified memos detail extent of improper Obama-era NSA spying MORE (R-Pa.).

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