During his first term in office, President Trump oversaw a substantial increase in the national debt and budget deficits.
Key Takeaways:
Significant Debt Increase: The national debt rose by approximately $7.8 trillion during Trump's term, according to ProPublica.
Fiscal Deterioration: The federal budget deficit increased significantly, reaching nearly 4% of the Gross Domestic Product (GDP) in 2018 and 4.6% in 2019, exceeding the nonpartisan Congressional Budget Office's (CBO) initial projections. The deficit in fiscal year 2020 reached a level not seen since World War II.
Contributing Factors:
Tax Cuts: The 2017 Tax Cuts and Jobs Act, which included a reduction in the corporate tax rate, significantly reduced federal revenue.
Spending Increases: The administration approved large increases in government spending, including:
Pandemic relief legislation (e.g., CARES Act)
Legislation raising discretionary spending caps
Increased defense spending
Comparison to Previous Administrations: The growth in the annual deficit under Trump was the third largest relative to the size of the economy, exceeded only by George W. Bush and Abraham Lincoln. Unlike Bush and Lincoln, who faced foreign conflicts and a civil war respectively, Trump's deficit increases occurred during a period of economic growth and low unemployment.
Proposed but Unenacted Deficit Reduction: President Trump's budget proposals outlined substantial deficit reduction measures, but nearly all of these proposed savings were not enacted into law.
In essence, despite campaign promises to reduce the national debt, the Trump administration oversaw a substantial increase due to tax cuts and spending increases, culminating in a significant worsening of the fiscal situation, particularly before and during the COVID-19 pandemic.
By
Crnr2Crnr ·
