The media breathlessly reports on every Congressional Budget Office report that comes down the pike on the Republican healthcare effort, but we can’t help but notice that they’ve largely ignored a new analysis that was quietly released by the federal agency. Perhaps because this one has quite a lot of positive news regarding the Trump agenda and its effect on the American economy. In other words, it doesn’t leave a lot of room for the doomsday punditry that has become the bread-and-butter of every fake, mainstream news outlet on the East Coast.
But for Americans who would actually like to get a real sense of where this administration is going on the things that matter, the new report is well worth perusing. It has a lot to say about the White House’s proposed budget for 2018, and there’s meat in here for every red-blooded conservative – NeverTrumper or not.
According to the analysis, if Congress were to pass Trump’s budget, it would reduce the federal deficit by $160 billion over the next ten years while ALSO increasing the Gross Domestic Product. This would be accomplished by cuts to both mandatory and discretionary spending, moves that would also take a chisel to our soaring national debt. The budget could potentially cut the debt to 80% of our GDP, which would slide 11 percentage points under the recommended CBO baseline figure. And by cutting federal expenditures in the sectors of healthcare, student loans, and income security programs, the Trump budget could reduce mandatory spending by nearly $2 trillion.
“The largest savings—$1.25 trillion over the 2018-2027 period—would stem from the proposal to repeal and replace the Affordable Care Act,” the CBO report said. “Additional 10-year savings of $610 billion would result from changes to the Medicaid program.
“The lower federal borrowing, relative to that projected under current law, would increase national saving, domestic investment, and the capital stock, thereby boosting output and income slightly and lowering interest rates somewhat,” the report continued. “As a result, average growth in inflation-adjusted GDP over the 2018-2027 period would be about 0.1 percentage point higher under the President’s proposals than under CBO’s baseline. GDP would be little changed through calendar year 2021 and 0.7 percent higher in 2027. Those economic effects would help reduce the deficit.”
Of course, a lot of this is dependent on Congress actually carrying through with the repeal and replacement of Obamacare, and that’s still very much up in the air. If they can get that bill across the finish line and tackle the tax reforms that most of the GOP is (apparently?) behind, we could see a boom period for the American economy that would have been unimaginable only a year or two ago. Let’s hope Washington has the political willpower to put this country back on the right track.