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Trump Presents Election-Year Budget Based on Lofty Growth Assumptions

Agence France-Presse

   WASHINGTON - With months left before U.S. elections, President Donald
   Trump unveiled a [1]budget roadmap on Monday that abandons key deficit
   cutting promises based on lofty and unlikely economic growth
   assumptions.

   The final spending plan of Trump's first term in office faces near
   certain defeat in the Democrat-controlled House of Representatives, but
   offers a window into the administration's priorities.

   The budget makes cuts to social programs, environmental protections and
   foreign assistance, to fund higher defense spending and extend tax cuts
   for wealthy individuals and companies, according to officials and
   multiple U.S. media reports.

   The proposal again abandons the stated goal of closing the budget
   deficit in 10 years, instead pushing the target date back to 2035.

   However, even that extended timeline assumes the U.S. economy will grow
   by 3.0 percent a year or close to it through 2030, which would support
   higher tax revenues, something not achieved consistently in over a
   decade, and unheard of for an economy after 11 consecutive years of
   growth.

   Despite pledging to pursue the Republicans' long-held war on deficits,
   the Trump administration has shown little interest in tackling the
   issue, with the gap expected to hit $1 trillion this year amid growing
   government debt --double the estimate in his first budget.

   The $4.8 trillion spending proposal for this year calls for $2 trillion
   in cuts to non-defense programs, including safety nets such as food
   stamps, and savings from the Medicare prescription drug coverage.

   Maya MacGuineas, president of the nonpartisan Committee for a
   Responsible Federal Budget, offered praise for some of the policies in
   the budget but called for serious action to reduce deficits.

   "We don't need more false promises about rapid economic growth or tax
   cuts that will pay for themselves. We need action to reverse our
   trillion-dollar deficits, save our largest trust funds, and prevent
   debt from reaching new record highs," she said in a statement.

   "Frankly, budgeting has become pretty much a joke in this country,
   where budgets are used as messaging documents and an excuse to trade
   insults. This year's trillion-dollar deficit should cause us to
   re-think this dynamic."

References

   1. https://www.whitehouse.gov/wp-content/uploads/2020/02/budget_fy21.pdf

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