Published: Fri, July 14, 2017
Industry | By Faith Ward

CBO Refutes White House, Predicts Trump Plan Won't Balance Budget

CBO Refutes White House, Predicts Trump Plan Won't Balance Budget

The Congressional Budget Office estimates President Donald Trump's budget proposal would shrink deficits by almost a third over the coming decade, but not almost as much as the White House projects.

According to the CBO's estimates, the deficit would fall from the $693 billion projected for 2017 to $593 billion in 2018 under the president's proposals, but after that, it would generally rise.

"The president's proposals would affect the economy in a variety of ways; however, because the details on numerous proposed policies are not available at this time, CBO can not provide an analysis of all their macroeconomic effects or of the budgetary feedback that would result from those effects", the report said. The White House had claimed it would reach a $16 billion budget surplus by that year.

The $4.1 trillion budget for 2018 that the White House proposed recommended a large increase in spending on the military and on border security.

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The deficit reduction created by Trump's budget proposal would result from lower spending over the next decade, the CBO said.

But under current law, the CBO expects economic growth to be about 1.8% on average over the next decade.

The budget when released received heavy criticism from Democrats and some skepticism from Republicans over heavy reductions in domestic spending. It particularly pointed to healthcare spending. The CBO isn't convinced that those tax cuts will generate much additional economic growth, either. While the White House and many Republicans have criticized CBO's coverage estimates for the Obamacare health law and the House and Senate GOP replacement plans, the White House hasn't been critical of CBO's budget predictions.

The Congressional Budget Office just released its analysis of President Trump's budget proposal, released earlier this year. Its projections included a $2 trillion math error, claiming the amount would be spent twice on balancing the budget and tax cuts.

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