Photo: Don Emmert Agence France-Presse
The economic growth expected in the next few years will not generate enough revenue to offset the cost of the largesse budget and tax of the republicans of Donald Trump.
The heyday of the economic policies of Donald Trump comes to an end. Now arrive their consequences in terms of lower growth and record debt for years to come.
The euphoric effect on the economy of tax cuts and increased government spending republican president will eventually fade this year, warned on Monday the Congressional budget Office (american English CBO) in a report on the economic and fiscal outlook in the United States. 3.1% on average last year, the growth rate of the economy will fall to 2.3% this year, before passing under its normal potential growth of the four following years, to only 1.7 % in average from 2020 to 2023, provides for the public agency independent.
Tariffs inflicted last year by Donald Trump to imports from China and other countries, as well as their own counter-sanctions, will play a relatively minor role in the downturn, writes the CBO, which stands at approximately 0.1% per year for the next ten years.
This is the rate that is on track to achieve the federal debt within ten years, the highest level since the period that had immediately followed the Second world War.
All of these prices, as the president threatened, however, still increasing, mainly to impact of undermining the competitiveness of export products in the u.s. and increase prices in the United States and thus to reduce the purchasing power of consumers and businesses.
The economic growth expected in the next few years will not generate enough revenue to offset the cost of the largesse budget and tax of the republicans of Donald Trump says the CBO. The deficits of the only federal government will spend so 779 billion u.s. dollars last year to about 900 billion this year, and then to an average of 1200 billion per year until 2028.
Elected officials prodigal
These shortfalls recurring will explode the federal debt. Equivalent to 78 % of the gross domestic product (GDP) at the end of 2019, the double of the average of the last 50 years, this debt is on track to achieve 93% by ten years, the highest level since the period that had immediately followed the Second world War, and to rise to 150 % in 2049. The situation could be even worse if he came to the elected representatives of the Congress the idea of carrying over some spending and tax cuts are supposed to turn off gradually between 2020 and 2025, in which case the federal debt could already be at 105 % of GDP in ten years.
According to these estimates, the expenditures of the federal government in interest on its debt would exceed its huge defence budget as soon as 2025. These estimates do not take into account a possible recession, which plomberait revenue and would explode the spending on social programs.
At the time of adoption, by 2017, their spending increases and the approximately 1500 billion of tax cuts over 10 years primarily for the benefit of businesses, but also individuals, especially the more wealthy, the elected republicans had argued that these measures would pay for themselves through the additional growth that they will generate. Donald Trump was dangled then an annual economic growth of 4 %, 5 %, 6 % eventually “.
“Shutdown”: permanent loss
All the economic damage inflicted by the shutdown does not disappear with time, said Monday the CBO. The interruption is partial of government services (shutdown), who was touched for five weeks some 800,000 federal employees, has had time to cost around 11 billion us dollars to the american economy before that Donald Trump and the camp democrat in Congress agree to a truce until at least 15 February. Most of the purchases, investments and services that have not occurred should be resumed later this year, but 3 billion, or 0.02 % of GDP, seem to have been lost for good, says the CBO, which does not take account of indirect impacts, for example, delays in the issuance of loans, and permits.