President Donald Trump‘s budget would reduce the federal deficit — but it will not balance the budget over a decade as the White House promised, according to a Thursday report from the nonpartisan Congressional Budget Office.
The president’s proposed fiscal year 2018 budget proposal would reduce the cumulative deficit by one-third relative to the CBO’s baseline projections over a decade, the report said. Debt as a percent of GDP would be an estimated 80 percent, 11 percent lower than under current projections, the CBO said.
The CBO said those figures “would be achieved by decreasing both mandatory and discretionary spending significantly compared with projections under current law.” It singled out a reduction in health-care spending, in particular.
However, the deficits the CBO projects “are larger” than those estimated by the Trump administration, because the White House projects higher revenue due to faster economic growth projections. Over the next decade, the CBO projects nominal GDP to be 6 percent lower than the White House does, while it expects revenues to be $3.6 trillion, or 8 percent, less than what the White House said.
When Office of Management and Budget Director Mick Mulvaney projected a balanced budget in 10 years, many skeptics raised concerns about the underlying calculations.
Congress ultimately gets to approve a budget for Trump’s signature, which means many of the White House’s priorities may not end up in the final budget.
The budget when released received heavy criticism from Democrats and some skepticism from Republicans over heavy reductions in domestic spending.
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