Republican tax cuts along with the $1.3 trillion spending bill will drive the federal budget deficit to nearly $1 trillion in 2019, according to budget projections released by the Congressional Budget Office (CBO) on Monday.From The Hill:
The $804 billion deficit this year would be a $139 billion increase over 2017, with the total representing 4 percent of gross domestic product (GDP).
In 2019, deficits would rise to $981 billion before peaking at 5.4 percent of GDP in 2022, according to the CBO's "Budget and Economic Outlook" report.
As for the federal debt?
The debt burden, the total amount the government owes relative to the size of the economy, is projected to reach 96 percent of GDP by the end of the decade, its highest level since the end of World War II, the report said.
And GDP will take a hit eventually as well, according to the report; and though current policies will provide a short-term economic boost, the CBO disagrees with President Donald Trump that the country will see sustained 3 percent growth over the long haul:
The CBO projected that real GDP will rise to 3.3 percent in 2018 before dropping below 2017 levels, to 2.4 percent, next year. The average growth over the entire decade is expected to remain moderate, at 1.9 percent.
The Trump administration has touted sustained 3 percent growth as a policy goal, so the CBO report could portend a slew of good economic headlines in the run-up to November’s midterm elections. But by the 2020 presidential election, growth is projected to slump to 1.8 percent, below levels seen in recent years.