Tag: fiscal 2018

Treasury Confirms Trump’s Huge Budget Deficits Are Real

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The U.S. Treasury reported this afternoon that the budget deficit through the first 10 months of fiscal 2018 was $685 billion, an almost 21 percent increase over the same period last year.

For all of 2018, Treasury is estimating that the deficit will be about $849 billion, 27 percent higher than 2017.

These numbers aren’t a surprise. The combination of lower revenues from the tax cut, higher interest payments on the national debt, increased Pentagon spending and no spending restraint anywhere else made the Trump spike in the budget deficit a certainty.

What is surprising is that no one in the Trump administration — not Office of Management and Budget Director Mick Mulvaney, not National Economic Council Director Larry Kudlow, not Council of Economic Advisers Chairman Kevin Hassett and not Treasury Secretary Steven Mnuchin — have so far even bothered to issue a vanilla statement about the Treasury’s numbers.

Given Trump’s promise during the campaign not just to balance the budget but to pay down the national debt, I would have expected at least a pro forma statement from someone in the administration saying that the deficit increase is terrible and that the government’s red ink will be coming down very soon.

Instead, the White House seems to be ignoring these new numbers in the hope that a Friday-afternoon-in-August-when-Congress-is-in-recess Treasury release will be ignored.

Follow Stan Collender on Twitter @thebudgetguy

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GOP Won’t Be Able To Hide From It’s Big Deficits Before The Election After All

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House and Senate Republicans who so far have successfully avoided talking about how their tax and spending policies are spiking the budget deficit won’t be able to pretend for much longer that the United States isn’t staring directly into a GOP-created fiscal policy abyss.

The U.S. Treasury and the Congressional Budget Office will issue separate reports just weeks before Election Day that show the actual 2018 deficit between $800 and $900 billion and the estimated 2019 deficit exceeding $1 trillion. The fiscal 2017 deficit was $665 billion.

The deficit numbers the GOP had hoped to bury at least until after the election will soon be available for all to see.

House and Senate Republicans so far have been able to avoid talking about the deficit by making a complete mockery of the Congressional Budget Act. Even though Congress is required by federal law to adopt an annual budget resolution (the only legislation all year that compares total revenues with total spending and forces representatives and senators to vote on the deficit), the GOP leadership decided early in 2018 to prevent that from happening.

No budget resolution meant no budget debate. No debate meant no media coverage. No coverage meant Republicans wouldn’t be asked to explain their votes in favor of trillion-dollar deficits when they had previously and emphatically demanded that the federal budget be balanced.

This cleverness will end when Treasury and CBO issue their reports this October in the final days of a fierce election. That will put the GOP’s breach of faith with its fiscal past on full display for all to see, report on, criticize and make snarky 280 character comments about.

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Given the Trump administration’s efforts to control the narrative on all issues and run roughshod over established rules and procedures, and given the president’s more-than-obvious belief that federal departments exist solely to do his bidding, delaying Treasury’s report until after the election would seem like something it would consider.

But while it’s possible that the White House could concoct a reason to order the report be held until after the election, Treasury’s Monthly Treasury Statement is expected, used and relied on by Wall Street. Delaying it for obvious political reasons may be a theoretical option but just isn’t likely.

In addition, the Congressional Budget Office has shown no willingness whatsoever to knuckle under to political pressure and so will almost certainly release its own Monthly Budget Review this October no matter what the Republican leadership demands it to do.

That means that the deficit numbers the GOP had hoped to bury at least until after the election will soon be publicly available.

This timing could not be worse for Republicans. Congress plans to be out of session by the time these two reports are issued so there will be no chance for the GOP incumbents running for reelection even to do something — like voting for a balanced budget amendment to the U.S. Constitution — before the election.

In addition, on top of all the recent multiple swamp-like events involving Trump former and former allies, this soon-to-be-confirmed break with long-time GOP deficit orthodoxy is almost certain to push a number of more traditional Republicans to reconsider if or how they will vote this November.

Don’t Forget To Follow Stan Collender on Twitter @thebudgetguy

Wait…Don’t Leave Just Yet…There’s So Much More:

Trump’s Deficits Will Cause Very Serious Challenges For Multiple Generations Of Americans
Here’s What I Told NPR This Morning About The Deficit (Spoiler Alert: It’s Not Pretty)
Trump’s Economic Lies, Damn Lies And Statistics Revealed For All To See
Ryan And McConnell: Lock’em Up 
This Is Why Trump Will Shut Down The Government
Raising The Chances Of A Government Shutdown This Fall To 60%
OMB Director Mick Mulvaney Says CBO Was Right After All
Yes…Trump Will Shut Down The Government This Fall
You’ve Been Warned: Trump’s Trillion Dollar Budget Deficits Are Here To Stay