The U.S. deficit will approach $1 trillion dollars by the end of this fiscal year, according to new estimates from the nonpartisan Congressional Budget Office. From this time last year until now, the U.S. deficit grew by $222 billion — reaching a total of $895 billion.
The CBO previously did not anticipate reaching $1 trillion dollars until 2020.
This latest analysis comes as House Republicans unveil their new round of tax cuts, colloquially named “Tax Cuts 2.0.” The cuts would add more than $2 trillion to the federal deficit over the next 10 years, according to a conservative estimate by The Washington Post. A more liberal estimate puts it at $3.4 trillion over the same time period. And that’s not even accounting for the $1.9 trillion dollar cost of the original GOP tax bill passed in December.
The second round of tax cuts, spearheaded by House Ways & Means Chairman Rep. Kevin Brady (R-TX), aims to fix what the original tax bill didn’t initially address. For example, while corporations enjoyed a permanent tax cut in the GOP tax bill, individuals and families were only offered a temporary cut that Congress would have to extend by 2025.
But those extensions come with a hefty price tag. According to a new score from the Joint Committee on Taxation, the Brady plan will cost an additional $630 billion by 2029. This, of course, could have been avoided if Republicans didn’t make the unnecessary 14 point reduction in the corporate tax rate permanent.
There is debate among more liberal circles about whether the rising deficits are such a bad thing in the first place. As Stephanie Kelton, a professor at Stony Brook University and former chief economist for the Senate Budget Committee Democratic staff has pointed out, adding $1.5 trillion to the deficit isn’t such a bad thing — so long as the money is going toward helping struggling people. But that is not what Republicans are doing.
The fact that Republicans, who for decades complained of rising debt under the Obama administration, are now seemingly fine with record high deficit, is a bit of a surprise. However, when factoring in how many Republicans are personally benefiting from the tax cuts, it is right in line with how the party has traditionally operated.