CBO Finds Budget Deal Will Cost $320 Billion
The Congressional Budget Office has released a series of estimates for the budget deal announced yesterday. The deal would add $320 billion to deficits over the next decade, or almost $420 billion with interest. The bill increases discretionary spending levels by $296 billion over the next two years, includes $89 billion in disaster spending, modest health care changes that roughly net out, and $15 billion in tax cuts from renewing tax breaks that expired at the end of 2016.
As a result of the spending deal and the fact that we already projected deficits to reach $1 trillion next year, the fiscal year 2019 deficit would climb to almost $1.2 trillion.
Because not all money budgeted would be projected to be spent in the 10-year window, the total outlays for discretionary and disaster spending are slightly lower than the increase in the caps.
|2018-2027 Costs/ Savings (-)|
|Net Revenue Decreases||$9 billion|
|Net Mandatory Spending Cuts||-$47 billion|
|Increase in Discretionary Spending Caps||$290 billion|
|Disaster Relief Spending||$68 billion|
|Interest Costs||$98 billion|
|Total Cost||$418 billion|
Source: CBO, CRFB Calculations. Totals may not sum due to rounding.
For more about the likely deficit and debt impacts of the bill, see our estimate from yesterday, Budget Deal Would Assure Permanent Trillion-Dollar Deficits, which we will be updating today. Stay tuned for more analysis.