Friday, January 27, 2017

US debt to rise another $9 trillion in next decade

Federal Debt Projected to Grow by Nearly $10 Trillion Over Next Decade - The New York Times - Allen Rappeport:

January 24, 2017 - "After seven years of fitful declines, the federal budget deficit is projected to swell again, adding nearly $10 trillion to the federal debt over the next 10 years, according to projections from the nonpartisan Congressional Budget Office. The numbers reveal the strain that government debt could have on the economy as President Trump presses to slash taxes and ramp up spending.

"The deficit figures released Tuesday will be a major challenge to House Republicans, who were swept to power in 2010 on fears of a bloated deficit and who made controlling red ink a major part of their agenda under former President Barack Obama.

"Statutory caps imposed in 2011 on domestic and military spending have helped temper the deficit. But those controls are likely to be swamped by health care and Social Security spending that will rise with an aging population.

"Now, congressional leaders will have to choose between their fealty to the cause of fiscal prudence and the demands of the new president, who wants $1 trillion in infrastructure work over 10 years, a surge in military spending and large tax cuts for individuals and corporations....

"The deficit is expected to shrink this fiscal year and next before increasing in 2019 and beyond. Deficits would cumulatively total $9.4 trillion from 2018 to 2027, the budget office projects. By 2023, the deficit would reach $1 trillion, and in 2027, a projected $1.4 trillion deficit would be equal to 5 percent of the economy....

"After the release of the report, the Republican Study Committee, the main organization for House conservatives, signaled that it would not ignore that rising red ink to accommodate Mr. Trump’s spending ambitions.

"'Without changes to the federal budget, we are on a path to fiscal crisis with spending, deficits and debt continuing to balloon out of control,' said Representative Mark Walker of North Carolina, the chairman of the group."

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