Unsustainable Fiscal Path – President Trump’s 2021 and Beyond Budget
The following excerpt is taken from President Trump’s 2021 Budget, issued in February 2020, before COVID-19 (page 6) – “America’s Future”:
Unsustainable Federal deficits and debt are a serious threat to America’s prosperity. Gross Federal debt is now more than $23 trillion. The 2019 deficit was $985 billion—the largest since the Great Recession—and will climb above $1 trillion this year and for years after.
Such high and rising debt will have serious negative consequences for the budget and the Nation. It slows economic growth, as the costs of financing the debt crowds out more productive investments and could eventually limit the Federal Government’s ability to respond to urgent national security needs, invest in key priorities such as infrastructure, and enact other pro-growth policies. In fact, by 2021, the United States will be spending more money on paying for the debt than for the budgets of the Departments of Veterans Affairs, Justice, Homeland Security, and the National Aeronautics and Space Administration combined.
Federal borrowing also competes for funds in the Nation’s capital markets, threatening higher interest rates, and crowding out new investment by the private sector that could create jobs and raise wages.
If America’s spending and debt crisis are not addressed and lower economic growth continues, American families will see a much lower standard of living. Higher interest rates would make it harder for families to buy homes, finance car payments, or pay for college. Fewer education and training opportunities stemming from lower investment would leave workers without the skills to keep up with the demands of a more technology-based, global economy. In addition, continued growth of debt and deficits will constrain American families’ ability to improve their lives and the lives of their children by claiming a larger share of family income for taxes. It is the children and grandchildren of today’s taxpayers who will bear the burden for this recklessness.