Deficit

The Next President Will Inherit a Massive Deficit

JM Ashby
Written by JM Ashby

The federal deficit will reach at least $1 trillion during the current fiscal year and that's a significant amount, but the deficit will jump by an even larger amount in fiscal 2021.

The Congressional Budget Office (CBO) had previously estimated that the federal deficit would stabilize and average about $1 trillion over the next 10 years but, for the first time that I can recall, the CBO is projecting that the deficit will stabilize around $1.3 trillion over the next 10 years.

After passing that mark this year, the deficit is expected to average $1.3 trillion between 2021-30, rising from 4.6% of GDP to 5.4% over the period. That’s well above the long-term average since around the end of World War II. The deficit since then has not topped 4% of GDP for more than five consecutive years, averaging just 1.5% over the period.

As part of a spending pattern that the CBO deemed unsustainable, the national debt is expected to hit $31.4 trillion by 2030.

Tuesday’s projections reflect a slight increase from the estimates presented in August 2019.

If there's a good reason to think the deficit will stop growing at $1.3 trillion, I haven't seen it.

The looming disasters and colossal messes that the next president will have to clean up after Trump is gone are one reason among many that I cannot personally get too excited about candidates promising to immediately throw trillion of dollars at all of our various problems simultaneously.

I don't necessarily disagree with those proposals nor do I disagree that we need to tackle big problems, but I also think they under-appreciate just how crippled and disheveled the federal government is going to be. The Trump regime has hallowed out the federal government over the last several years while also creating messes in almost every foreign country the next president will also have to clean up.

It will be a tremendous lift for the next administration and session of Congress to repeal Trump's tax cuts or replace them just to make up for fiscal ground we've already lost. Anything beyond that does not strike me as very realistic.

Keep in mind that ending Trump's trade war could also add almost $100 billion to the deficit as that's close to the amount the Treasury is receiving in import duties which totaled over $80 billion last year.

  • muselet

    In this regard, Donald Trump is a bog-standard R: increase the deficit and debt, chase qualified and knowledgeable people out of government, put in place policies that make it as difficult as possible to undo the damage caused, then join the R chorus in slagging off the Ds for trying to clean up the mess.

    Deficits and debt aren’t necessarily bad things: in bad times, using deficit spending for stimulus is a good thing. Unfortunately, the Rs specialize in racking up deficits in (relatively) good times, when the smart thing to do is run surpluses (so there will be some cushion when the economy inevitably goes south).

    What makes Trump unique—and uniquely dangerous—is how laser-focused he and his minions have been on eliminating expertise in the federal government. Getting the economy back on a solid footing will be child’s play compared to reintroducing empirical reality and the means of studying it.

    Future historians will rightly wonder why we did this to ourselves.

    –alopecia

    • Ceoltoir

      We didn’t do this to ourselves. The shameful relic of slavery called the electoral college forced two wildly incompetent so-called presidents on the country with a minority of the vote.

  • katanahamon

    This is ultimately the fault of the public allowing the Right Wing Media Infotainment Complex™️ to become propaganda cheerleaders of the right wing, never presenting the actual facts of our collective situation. See, when the S hits the fan, the Dems will try to fix things, and suddenly, the Republicans will start speaking out about the terrible dangers of deficit spending and debt, targeting the social safety net, things like Social Security, Medicare, Disability, Medicaid, etc. Meanwhile they’ve already gotten what they wanted with massive cash tax giveaways to the rich and corporations, increased military spending, and bogus pet projects like border walls. All the right wingers have to do is say “they’re coming for your guns, they want to kill babies, they want to take your taxes to kill babies, and give your taxes away to immigrant baby mommas that bring their whole families here who they’ll make citizens, Socialism!Socialism!!” and the rubes will keep voting R despite the reality that they are voting completely against their own interests. Yeah..it’s depressing how stupid we seem to be getting.