Federal Budget Deficit Estimated To Exceed $1 Trillion By End Of Year
The federal budget deficit is growing much more rapidly than President Donald Trump‘s administration had anticipated. The president’s 2017 tax cuts and spending increases have caused the U.S. to borrow increasingly larger amounts.
The deficit is the difference between what the government spends and what it makes from taxes. It is estimated to reach $960 billion by September 30, which is the end of its fiscal year. Officials believe it will rise to $1 trillion by the end of 2020.
The deficit is rising faster than initially expected because of Trump’s tariffs. Last spring, it was predicted to be $896 billion by the end of the fiscal year.
The president’s 2017 tax cuts have caused a huge loss in revenue. The revenue from taxes from 2018 and 2019 is around $430 billion short of what officials thought it would be in 2017.
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Agreements between Congress and the White House to raise military and nondefense discretionary spending further worsened the outlook. If Trump’s trade war continues, the deficit is expected to rise even faster.
Trump has shown little interest in fighting the deficit. Recently, Trump has dicussed cutting payroll tax which would add $75 billion to the deficit. He has also proposed reducing taxes on capital gains which would add $100 billion over the next ten years.
During the 2019 campaign, Trump promised to balance the budget and pay the entire national debt off.
Conservatives, who have supported the tax cuts, urge the government to find other ways to reduce the deficit. They say that funding to federal health care, Medicare and Social Security should be cut.
Democrats have criticized Trump’s spending but have provided the majority of votes needed to pass recent government increases.
Democrats campaigning for the presidency have called for programs that would continue to increase spending, such as Medicare For All, which they say will be paid for by ending Trump’s tax cuts and imposing heavier taxes on the rich.
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