Trump released his proposed budget for 2021 on Monday and it’s based on math straight from fantasy land. The assumptions it makes about future economic growth, and therefore growth in federal revenue, are wildly unrealistic and far beyond what is expected by economists and by non-partisan federal agencies like the Congressional Budget Office.
President Trump’s budget proposals have been defined by a belief that the economy will grow significantly faster than most economists anticipate. The latest version, set for release on Monday, is a brief departure: It concedes, for the first time, that the administration’s past projections were too optimistic.
Then it goes right back to forecasting 3 percent growth, for the better part of a decade…
According to summary tables reviewed by The New York Times and interviews with administration officials, the new budget will forecast a growth rate for the United States economy of 2.8 percent this year — or, by the metric the administration prefers to cite, a 3.1 percent rate. That is more than a half percentage point larger than forecasters at the Federal Reserve and the Congressional Budget Office predict.It then predicts growth above 3 percent annually for the next several years if the administration’s economic policies are enacted. The Fed, the budget office and others all see growth falling below 2 percent annually in that time. By 2030, the administration predicts the economy will be more than 15 percent larger than forecasters at the budget office do.
So what happens when those projections fail to come true? Revenue falls far below its projections, which means the federal budget deficit balloons even more. Trump has already added more than $3 trillion to the debt despite promising to pay off the entire debt in 8 years (and saying it would be “easy” even though that would require a $2.5 trillion surplus every year for eight years). In Trumpworld, reality is whatever he declares it to be.