Budget Hawks Say Both Candidates’ Spending Plans Would Add Trillions to National Debt

With the economy and affordability being cited as the most important issue to voters in November, President Trump and Vice President Harris are leaning hard on their respective messages on tax cuts, social spending, and economic assistance for middle-class families. The long-term effects, however, could be severe for the nation’s debt problem, according to a new analysis of both candidates’ plans. The Committee for a Responsible Federal Budget has been releasing reports on estimated costs for presidential candidates’ spending and tax plans for years, and they include what they call a “low” estimate, a “central” estimate, and a “high” estimate, meaning they provide cost estimates from the most optimistic to the most pessimistic with respect to deficit spending and total additions to the debt. In a new report, the committee finds that on all of those estimates, both candidates’ plans would significantly add to the $35 trillion national debt, though Trump’s additions would be significantly higher. For the vice president’s “low” estimate, the committee says that her proposals would have nearly no impact on the annual budget deficit, while Trump’s best-case scenario adds more than $1 trillion to the national debt. The high estimate for Ms. Harris would be an $8 trillion addition to the debt, while Trump’s high estimate is nearly double, at more than $15 trillion over ten years. “Neither major candidate running in the 2024 presidential election has put forward a plan to address this rising debt burden. In fact, our comprehensive analysis of the candidates’ tax and spending plans finds that both Vice President Kamala Harris and former President Donald Trump would likely further increase deficits and debt above levels projected under current law,” the committee writes.In their “central” estimate, the think tank says Ms. Harris would increase the debt by $3.5 trillion, compared to Trump, who would add $7.5 trillion. The price tag of Trump’s fiscal plans are largely driven by his promise to extend the 2017 Tax Cuts and Jobs Act, which he signed as president. That legislation led to a $3 trillion reduction in revenue, further fueling deficit spending and the debt balloon. Extending the act — which expires at the end of 2025 — is projected to reduce revenues by another $5.35 trillion. One of the other large expenditures in Trump’s plan is his promise to reduce the corporate tax rate by nearly 25 percent — to 15 percent from the current 21 percent. Some Republicans have pushed back on this proposal given its implications for the deficit, saying that if America is going to get out of its $35 trillion debt hole, it may not be prudent to be slashing taxes. “There’s a bubbling-up concern that we should not be doing the bidding of corporate America,” Congressman Chip Roy told reporters in June. He said he is open to raising the corporate rate to as much as 25 percent. “I’d like to see corporations getting with the program and saving America, instead of just looking at their bottom line,” he said. Experts warn that Trump’s spending cuts aren’t nearly enough to offset the decreased revenues that America will see should he get all of the tax reductions he has promised. His three most notable spending cut proposals — eliminating green energy subsidies, abolishing the department of education, reducing the bureaucracy in the executive branch, and cracking down on fraud — would only result in a reduction of spending of about $100 billion per year over the next decade. Currently, the annual budget deficit is nearly $2 trillion. His proposed tariffs would be the biggest revenue source for the former president, bringing in an estimated $2.7 trillion through 2035. While Ms. Harris’s proposals would add less to the deficit and the debt, she would still be contributing an historic amount should she get everything she wants. Her plan would result in deficits reaching anywhere between seven and 9.4 percent of gross domestic product, which would be the highest ratio outside of a war or a recession in the nation’s history. The vice president’s priciest items on her wish list include a modified extension of the 2017 tax bill to maintain the tax cuts for those who make less than $400,000 annually. That would reduce revenues by $3 trillion between 2026 and 2035. Her expansions of the Child Tax Credit and the Earned Income Tax Credit would have a price tag of $1.4 trillion over a decade, the committee estimates.

Budget Hawks Say Both Candidates’ Spending Plans Would Add Trillions to National Debt

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