TRUMPONOMICS IS monumentally unwise, to the extent anyone can make sense of it. Contrary to the Trump administration’s grandiose assurances, the independent analysts at the Congressional Budget Office (CBO) said Thursday that there is no proposal in President Trump’s budget that would supercharge economic growth — the president promised 3 percent per year — and balance the budget within a decade. Instead, they found a lot of question marks and missing details.
Without the miraculous economic growth Mr. Trump promised, the CBO found that the president’s plan would cut federal revenue by nearly $ trillion over a decade. Deep spending cuts would offset this decline, but nowhere near enough to balance the budget. The cumulative deficit would drop by about a third between now and 2027 and slow the rise in the national debt, but hefty deficits would nevertheless remain. And that’s assuming Congress would enact the spending cuts along with the tax reductions, which it wouldn’t.
What fiscal discipline Mr. Trump’s plan contains would be achieved by cutting the wrong things, hobbling basic government functions, while leaving the major drivers of the country’s fiscal problems mostly untouched. The president would suck money out of health programs such as the Affordable Care Act (ACA). He would also squeeze discretionary spending — that is, what most people think the government does, from running the national parks to conducting medical research to maintaining foreign embassies — to a place unprecedented in modern times, dropping it from 6.3 percent of gross domestic product to 4.1 percent in a decade. It has not fallen below 6 percent in more than 50 years.
The president is counting on an ambitious rejiggering of the tax code to stimulate economic growth. Critics, we among them, point out that his tax plan appears to be based on the fantasy that the tax cuts will pay for themselves. For its part, the CBO found that the president’s tax plan was so vague, it was unreasonable even to try to assess its specific effects on economic growth and the nation’s fiscal balance.
But wouldn’t the economy get a boost from a promised infusion of infrastructure spending? Not really. The $200 billion Mr. Trump has proposed would be largely offset by cuts in various types of infrastructure spending elsewhere in the budget.
The CBO will release this week another, much-anticipated assessment — of the latest Senate health-care bill. In a Post op-ed, the White House pre-butted the office’s findings by continuing its assault on the experts, arguing that they were off in past projections and that their new estimates “will be little more than fake news.”
In fact, the CBO’s record on the ACA is not perfect but quite good. Its critics certainly can point to no alternative analysis that is more credible. The CBO produces rigorous projections using consistent methods and advanced economic modeling. Unlike executive agencies populated by Trump administration loyalists, the CBO is largely insulated from political pressure. No projection will be perfect. But no official organization deserves more trust to get it right.
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