I want to keep this one simple but that is a tall order. I think that’s why people need to spend time to sit down with this and actually go through the numbers.
Trump’s tax plan would reduce tax receipts by .59 trillion dollars per year. Total receipts are 3.25 trillion per year in 2015. This reduces total receipts to 2.66 trillion.
3.25-.59=2.66 total tax revenues
The deficit was .44 trillion dollars. This new .59 trillion dollars will be added to the deficit. This means the total deficit is 1.03 trillion under this plan.
.59+.44=1.03 total deficit assuming same GDP under Trump tax plan
Total spending, assuming that we don’t change immigration policy or other expensive policies, can remain at 3.7 trillion dollars. That means around 28% of the federal budget will be paid for as further debt.
1.03/3.7=.28 (28% of federal spending would be paid for as debt)
The US GDP was 17.914 trillion in 2015. In order to balance the budget under this new Trump plan, spending would have to remain the same and GDP would have to increase by 28% to eliminate the deficit.
18*1.28=23.04 trillion dollar GDP required
23.04 trillion dollars is around what we are targeting to hit by 2023. Trump’s policies will need to do that by 2017, or we’ll have a problem. The other option is to reduce spending by more than a quarter.
All non-defense discretionary is 16% of the budget. Healthcare also accounts for the decrease in spending by the government of the Affordable Care Act not to mention the other side with the increased tax revenues so the majority of that is Medicare.
The assumed targets here would be science research and welfare. I am assuming education, law enforcement, international affairs, and transportation would be left alone. So, we’re looking at 47% of the 16% on the table if we just completely get rid of all of that. We’re talking about 7.5% of the federal budget here.
That falls well short of the 28% we need and is saying nothing for the impacts of getting rid of science and letting people die in poverty.
We’ll see how things work out in practice, but I don’t understand how the numbers can add up to a good outcome for the country.