Deficit

White House Officially Projects a $1 Trillion Deficit

JM Ashby
Written by JM Ashby

There have been reports that the White House is anticipating that the federal budget deficit would increase to at least $1 trillion this year and they made it official yesterday evening.

The White House Office of Management and Budget (OMB) released their mid-year review which anticipates a trillion dollar deficit for the current fiscal year ending on September 30th.

But hey -- it could have been worse.

The White House projects that the federal deficit will surpass $1 trillion this year, the only time in the nation's history the deficit has exceeded that level, excluding the four-year period following the Great Recession.

"The 2019 deficit has been revised to a projected $1.0 trillion," the White House Office of Management and Budget (OMB) wrote in its midyear review. [...]

The OMB projection is actually $91 billion lower than its previous estimate, largely because of technical provisions and somewhat lower than expected mandatory and interest spending.

While the White House's new estimate is lower than their previous, we should also keep in mind that the federal government has collected over $50 billion in tariffs during the current fiscal year.

So, if not for Trump's trade war and the slightly lower than expected spending on interest, the deficit would already be closer to $1.15 trillion.

I am not a deficit hawk, but I do think it's a little concerning that we're seeing numbers like this at a time when the economy is still technically expanding and unemployment is historically low. It's concerning for the same reason that the Federal Reserve cutting interest rates at a time like this is concerning. There won't be much room to maneuver if an actual economic downturn arrives.

We're seeing recession-like deficits at a time when there is no recession. At least not yet. On the other side of this are inevitable tax hikes.

  • Christopher Foxx

    On the other side of this are inevitable tax hikes.

    And, since Republican administrations always screw up the economy and it’s then always up to a Democratic administration to clean up their mess, the inevitable tax increases will happen when a Democrat is President.

    Meaning the Republicans will scream and point about how Democrats only ever want to raise your taxes and steal your money.

    It makes me think Democrats should just cede the presidency to the Republicans for, like, 3 or 4 elections until their mismanagement and lies just can’t be ignored by Joe Teabag anymore.

    “Nah, we’re not gonna run anyone. Here, have some more rope.”

  • muselet

    Rs only pretend to care about the deficit and national debt when the president is a D. As soon as an R occupies the White House, they start quoting Dick Cheney: “You know, Paul, Reagan proved that deficits don’t matter.”

    As for Donald Trump and the current GOP, their idea of long-term planning is deciding what to have for breakfast tomorrow. If the economy goes down the pan, their only concern is it happens after the 2020 election.

    It’s galling to see Rs so blasé about the budget deficit after having shrieked themselves hoarse about how the terrible socialistical Kenyan Marxist usurper irresponsibly ran up record debt! that would burden future generations! not just during Barack Obama’s presidency, but for the two years since he left office. Plus, you know the Rs will blame the Ds for any dire consequences.

    Shameless.

    –alopecia

    • Badgerite

      Utterly. Sean Duffy, the ‘ax-man’ who was going to cut deficit spending, suddenly doesn’t care about the deficit. Republicans are good at one thing. Taking orders from their ultra wealthy donors.
      Scott Walker turned down a federally funded high speed rail between Madison and Milwaukee because of possible future “maintenance costs” but put the taxpayers of Wisconsin on the line for a shitload of money in the future for a highly automated distribution hub for a foreign manufacturer. The hypocrisy and dishonesty is so obvious it hurts.

  • Badgerite

    If I didn’t know better I would say the gop is trying to create a future budgetary crisis so that they have an excuse to cut popular programs that, you know, actually help people.