ELON X.
2023-10-24 17:11:57 UTC
$10 Trillion in Added US Debt Since 2001 Shows 'Bush and Trump Tax Cuts
Broke Our Modern Tax Structure'
"In their blind loyalty to their mega-donors, Republicans' fixation on
giant tax cuts for billionaires has created a revenue problem that is
driving up our national debt," said Sen. Sheldon Whitehouse in response to
new Treasury Department figures.
Jon Queally
Oct 21, 2023
51
The U.S. Treasury Department on Friday released new figures related to the
2023 budget that showed a troubling drop in the nation's tax revenue
compared to GDPa measure which fell to 16.5% despite a growing
economyand an annual deficit increase that essentially doubled from the
previous year.
"After record U.S. government spending in 2020 and 2021" due to programs
related to the economic fallout from the Covid-19 crisis, the Washington
Postreports, "the deficit dropped from close to $3 trillion to close to $1
trillion in 2022. But rather than continue to fall to its pre-pandemic
levels, the deficit unexpectedly jumped this year to roughly $2 trillion."
While much of the reporting on the Treasury figures painted a picture of
various and overlapping dynamics to explain the surge in the
deficitincluding higher payments on debt due to interest rates, tax
filing waivers related to extreme weather events, the impact of a student
loan forgiveness program that was later rescinded, or a dip in capital
gains receiptsprogressive tax experts say none of those complexities
should act to shield what's at the heart of a budget that brings in less
than it spends: tax giveaways to the rich.
Bobby Kogan, senior director for federal budget policy at the Center for
American Progress, has argued repeatedly that growing deficits in recent
years have a clear and singular chief cause: Republican tax cuts that
benefit mostly the wealthy and profitable corporations.
In response to the Treasury figures released Friday, Kogan said that
"roughly 75%" of the surge in the deficit and the debt ratio, the amount
of federal debt relative to the overall size of the economy, was due to
revenue decreases resulting from GOP-approved tax cuts over recent
decades. "Of the remaining 25%," he said, "more than half" was higher
interest payments on the debt related to Federal Reserve policy.
"We have a revenue problem, due to tax cuts," said Kogan, pointing to the
major tax laws enacted under the administrations of George W. Bush and
Donald Trump. "The Bush and Trump tax cuts broke our modern tax structure.
Revenue is significantly lower and no longer grows much with the
economy." And he offered this visualization about a growing debt ratio:
Trump and Bush tax cuts killed us tax structure
"The point I want to make again and again and again is that, relative to
the last time CBO was projecting stable debt/GDP, spending is down, not
up," Kogan said in a tweet Friday night. "It's lower revenue that's 100%
responsible for the change in debt projections. If you take away nothing
else, leave with this point."
In his tweet, Kogan offered the following chart to show recent and
projected levels of both federal revenue and spending relative to gross
domestic product (GDP):
Debt ratio chart
In a detailed analysis produced in March, Kogan explained that, "If not
for the Bush tax cuts and their extensionsas well as the Trump tax
cutsrevenues would be on track to keep pace with spending indefinitely,
and the debt ratio (debt as a percentage of the economy) would be
declining. Instead, these tax cuts have added $10 trillion to the debt
since their enactment and are responsible for 57 percent of the increase
in the debt ratio since 2001, and more than 90 percent of the increase in
the debt ratio if the one-time costs of bills responding to COVID-19 and
the Great Recession are excluded."
On Friday, the office of Sen. Sheldon Whitehouse (D-R.I.) cited those same
numbers in a press release responding to the Treasury's new report.
"Tax giveaways for the wealthy are continuing to starve the federal
government of needed revenue: those passed by former Presidents Trump and
Bush have added $10 trillion to the debt and account for 57 percent of the
increase in the debt-to-GDP ratio since 2001," read the statement. "If not
for those tax cuts, U.S. debt would be declining as a share of the
economy."
Whitehouse, who chairs the Senate Budget Committee, said the dip in
federal revenue and growth in the overall deficit both have the same
primary cause: GOP fealty to the wealthy individuals and powerful
corporations that bankroll their campaigns.
"In their blind loyalty to their mega-donors, Republicans' fixation on
giant tax cuts for billionaires has created a revenue problem that is
driving up our national debt," Whitehouse said Friday night. "Even as
federal spending fell over the last year relative to the size of the
economy, the deficit increased because Republicans have rigged the tax
code so that big corporations and the wealthy can avoid paying their fair
share."
Offering a solution, Whitehouse said, "Fixing our corrupted tax code and
cracking down on wealthy tax cheats would help bring down the deficit. It
would also ensure teachers and firefighters don't pay higher tax rates
than billionaires, level the playing field for small businesses, and
promote a stronger economy for all."
None of the latest figuresthose showing that tax cuts have injured
revenues and therefore spiked deficits and increased debtshould be a
surprise.
In 2018, shortly after the Trump tax cuts were signed into law, a
Congressional Budget Office (CBo) report predicted precisely this result:
that revenues would plummet; annual deficits would grow; and not even the
promise of economic growth made by Republicans to justify the giveaway
would be enough to make up the difference in the budget.
"The CBO's latest report exposes the scam behind the rosy rhetoric from
Republicans that their tax bill would pay for itself," Sen. Chuck Schumer
(D-N.Y.), and now Senate Majority Leader, said at the time.
"Republicans racked up the national debt by giving tax breaks to their
billionaire buddies, and now they want everyone else to pay for them."
In its 2018 report, the CBO predicted the deficit would rise to $804
billion by the end of that fiscal year. Now, for all the empty promises
and howling from the GOP and their allied deficit hawks, the economic
prescription they forced through Congress has resulted in an annual
deficit of more than double that, all while demanding the nation's poorest
and most vulnerable pay the price by demanding key social
programsincluding food aid, education budgets, unemployment benefits, and
housing assistancebe slashed.
Meanwhile, the GOP majority in the U.S. Housewith or without a Speaker
currently holding the gavelstill has plans to extend the Trump tax cuts
if given half a chance. In May, a CBO analysis of that pending legislation
found that such an extension would add an additional $3.5 trillion to the
national debt.
"Republicans racked up the national debt by giving tax breaks to their
billionaire buddies, and now they want everyone else to pay for them,"
Sen. Whitehouse said at the time. "It is one of life's great enigmas that
Republicans can keep a straight face while they simultaneously cite the
deficit to extort massive spending cuts to critical programs and support a
bill that would blow up deficits to extend trillions in tax cuts for the
people who need them the least."
https://www.commondreams.org/news/trump-bush-tax-cuts-fuel-growing-
deficits
Broke Our Modern Tax Structure'
"In their blind loyalty to their mega-donors, Republicans' fixation on
giant tax cuts for billionaires has created a revenue problem that is
driving up our national debt," said Sen. Sheldon Whitehouse in response to
new Treasury Department figures.
Jon Queally
Oct 21, 2023
51
The U.S. Treasury Department on Friday released new figures related to the
2023 budget that showed a troubling drop in the nation's tax revenue
compared to GDPa measure which fell to 16.5% despite a growing
economyand an annual deficit increase that essentially doubled from the
previous year.
"After record U.S. government spending in 2020 and 2021" due to programs
related to the economic fallout from the Covid-19 crisis, the Washington
Postreports, "the deficit dropped from close to $3 trillion to close to $1
trillion in 2022. But rather than continue to fall to its pre-pandemic
levels, the deficit unexpectedly jumped this year to roughly $2 trillion."
While much of the reporting on the Treasury figures painted a picture of
various and overlapping dynamics to explain the surge in the
deficitincluding higher payments on debt due to interest rates, tax
filing waivers related to extreme weather events, the impact of a student
loan forgiveness program that was later rescinded, or a dip in capital
gains receiptsprogressive tax experts say none of those complexities
should act to shield what's at the heart of a budget that brings in less
than it spends: tax giveaways to the rich.
Bobby Kogan, senior director for federal budget policy at the Center for
American Progress, has argued repeatedly that growing deficits in recent
years have a clear and singular chief cause: Republican tax cuts that
benefit mostly the wealthy and profitable corporations.
In response to the Treasury figures released Friday, Kogan said that
"roughly 75%" of the surge in the deficit and the debt ratio, the amount
of federal debt relative to the overall size of the economy, was due to
revenue decreases resulting from GOP-approved tax cuts over recent
decades. "Of the remaining 25%," he said, "more than half" was higher
interest payments on the debt related to Federal Reserve policy.
"We have a revenue problem, due to tax cuts," said Kogan, pointing to the
major tax laws enacted under the administrations of George W. Bush and
Donald Trump. "The Bush and Trump tax cuts broke our modern tax structure.
Revenue is significantly lower and no longer grows much with the
economy." And he offered this visualization about a growing debt ratio:
Trump and Bush tax cuts killed us tax structure
"The point I want to make again and again and again is that, relative to
the last time CBO was projecting stable debt/GDP, spending is down, not
up," Kogan said in a tweet Friday night. "It's lower revenue that's 100%
responsible for the change in debt projections. If you take away nothing
else, leave with this point."
In his tweet, Kogan offered the following chart to show recent and
projected levels of both federal revenue and spending relative to gross
domestic product (GDP):
Debt ratio chart
In a detailed analysis produced in March, Kogan explained that, "If not
for the Bush tax cuts and their extensionsas well as the Trump tax
cutsrevenues would be on track to keep pace with spending indefinitely,
and the debt ratio (debt as a percentage of the economy) would be
declining. Instead, these tax cuts have added $10 trillion to the debt
since their enactment and are responsible for 57 percent of the increase
in the debt ratio since 2001, and more than 90 percent of the increase in
the debt ratio if the one-time costs of bills responding to COVID-19 and
the Great Recession are excluded."
On Friday, the office of Sen. Sheldon Whitehouse (D-R.I.) cited those same
numbers in a press release responding to the Treasury's new report.
"Tax giveaways for the wealthy are continuing to starve the federal
government of needed revenue: those passed by former Presidents Trump and
Bush have added $10 trillion to the debt and account for 57 percent of the
increase in the debt-to-GDP ratio since 2001," read the statement. "If not
for those tax cuts, U.S. debt would be declining as a share of the
economy."
Whitehouse, who chairs the Senate Budget Committee, said the dip in
federal revenue and growth in the overall deficit both have the same
primary cause: GOP fealty to the wealthy individuals and powerful
corporations that bankroll their campaigns.
"In their blind loyalty to their mega-donors, Republicans' fixation on
giant tax cuts for billionaires has created a revenue problem that is
driving up our national debt," Whitehouse said Friday night. "Even as
federal spending fell over the last year relative to the size of the
economy, the deficit increased because Republicans have rigged the tax
code so that big corporations and the wealthy can avoid paying their fair
share."
Offering a solution, Whitehouse said, "Fixing our corrupted tax code and
cracking down on wealthy tax cheats would help bring down the deficit. It
would also ensure teachers and firefighters don't pay higher tax rates
than billionaires, level the playing field for small businesses, and
promote a stronger economy for all."
None of the latest figuresthose showing that tax cuts have injured
revenues and therefore spiked deficits and increased debtshould be a
surprise.
In 2018, shortly after the Trump tax cuts were signed into law, a
Congressional Budget Office (CBo) report predicted precisely this result:
that revenues would plummet; annual deficits would grow; and not even the
promise of economic growth made by Republicans to justify the giveaway
would be enough to make up the difference in the budget.
"The CBO's latest report exposes the scam behind the rosy rhetoric from
Republicans that their tax bill would pay for itself," Sen. Chuck Schumer
(D-N.Y.), and now Senate Majority Leader, said at the time.
"Republicans racked up the national debt by giving tax breaks to their
billionaire buddies, and now they want everyone else to pay for them."
In its 2018 report, the CBO predicted the deficit would rise to $804
billion by the end of that fiscal year. Now, for all the empty promises
and howling from the GOP and their allied deficit hawks, the economic
prescription they forced through Congress has resulted in an annual
deficit of more than double that, all while demanding the nation's poorest
and most vulnerable pay the price by demanding key social
programsincluding food aid, education budgets, unemployment benefits, and
housing assistancebe slashed.
Meanwhile, the GOP majority in the U.S. Housewith or without a Speaker
currently holding the gavelstill has plans to extend the Trump tax cuts
if given half a chance. In May, a CBO analysis of that pending legislation
found that such an extension would add an additional $3.5 trillion to the
national debt.
"Republicans racked up the national debt by giving tax breaks to their
billionaire buddies, and now they want everyone else to pay for them,"
Sen. Whitehouse said at the time. "It is one of life's great enigmas that
Republicans can keep a straight face while they simultaneously cite the
deficit to extort massive spending cuts to critical programs and support a
bill that would blow up deficits to extend trillions in tax cuts for the
people who need them the least."
https://www.commondreams.org/news/trump-bush-tax-cuts-fuel-growing-
deficits