President Trump’s 2020 spending proposal used overly optimistic economic projections that would have resulted in a balanced budget after 25 years without any of the cuts to non-defense programs put forth by the administration, according to a new analysis.
The White House budget request for fiscal year 2020 calls for deep cuts to non-defense spending, as well as massive reductions to entitlement programs like Medicare, citing the need to lower the deficit. The approach would balanced the budget after 15 years, instead of the 10-year frame typically used in federal budgeting, the White House estimated.
{mosads}But an analysis published Tuesday by the Committee for a Responsible Federal Budget, a group that advocates for deficit reduction, found that the budget would be balanced after 25 years, even if the 2017 GOP tax-cut law were extended, based solely on the administration’s high-growth estimates.
“Rosy economic assumptions – not serious spending cuts – deserve most of the credit,” the analysis found.
Projections that show the debt fixing itself over time, the group said, are unrealistic.
“Despite a number of thoughtful spending reforms, it is clear the deficit reduction in the President’s budget does little to fix our fiscal situation. Instead, they rely on economic assumptions that are unlikely to materialize,” the group added.
The White House budget assumes that the U.S. economy will grow at 3 percent on average each year, a sharp contrast from private forecasts and those compiled by the nonpartisan Congressional Budget Office. Those estimates estimate growth hovering around 2 percent.
The economy did not hit 3 percent annual growth in 2017 or 2018. Economists project growth will slow somewhat this year and next as the stimulus effects of the GOP tax law begin to fade.