NC Budget and Tax Center, Trump Administration

President Trump’s budget does not add up ($2 trillion math error)

President Trump’s proposed budget was unveiled earlier this week and it includes a $2 trillion math mistake.

According to the proposed budget, “a comprehensive overhaul to our tax code will boost economic growth and investment”, and assumes an aggressive 3 percent growth in the economy. This of course differs significantly from the Congressional Budget Office (CBO) projection of moderate 1.9 percent economic growth over the next ten years reported in its most recent budget and economic outlook. [Note: this large a gap between an administration’s growth forecast and CBO’s is unprecedented (see graph).]

Due to the exaggerated growth assumption, Trump’s budget assumes a $2 trillion increase in revenue through economic growth that will balance the budget. However, the math does not add up as the Trump tax cut is also supposed to pay for the Trump tax cuts. So the $2 trillion is a double-counting error.

In other words, the assumed $2 trillion from higher growth is a double-count as it pays for the Trump tax cuts, and then it pays again for balancing the budget.

Overall, it is clear that Congress must step up and craft a budget that actually adds up and is grounded in serving all of the American people.

Luis A. Toledo is a Public Policy Analyst for the Budget & Tax Center, a project of the North Carolina Justice Center.

Check Also

On taxes there is a different set of rules that helps the rich, but not the working class

Tax revenues support public investments and therefore are ...

Top Stories from NCPW

  • News
  • Commentary

Dreamers looking for bold action from a new administration President-elect Joe Biden said last week [...]

Outgoing administration proposes to bring back use of electrocution, firing squads People on federal [...]

Two-thirds of 107 schools in North Carolina met or exceeded academic growth goals Granville County S [...]

Donald Trump's baseless, nonstop public allegations of pervasive fraud, election meddling and d [...]

#StoptheStupid. That little zinger of a Twitter hashtag drew national headlines in recent days after [...]

The post The Spike appeared first on NC Policy Watch. [...]

There’s been a great deal of introspection and handwringing by North Carolina progressives in recent [...]

The post A verdict to give thanks for appeared first on NC Policy Watch. [...]