President Trump's Fiscal Record So Far
As the first year of the Trump Presidency closes, it is worth taking a look at how the fiscal health of the country has changed since President Trump was sworn in.
Federal debt held by the public has risen from $14.404 trillion on Inauguration Day to $14.813 trillion today, an increase of $409 billion. Gross debt, a less economically meaningful measure that includes money the federal government owes to itself, has risen $546 billion. While the President has himself pointed to the absolute change in debt outstanding as an indication of his fiscal performance, these numbers are in large part a reflection of the economic conditions and policies that were already in place when he entered office – particularly this early in his term.
A more meaningful (albeit more uncertain) measure of the fiscal impact of President Trump’s first year is to look at the incremental effect that legislation enacted in 2017 will have on the budget over the next few years, such as by the end of a hypothetical second term. To do so, we tabulated the cost of all bills signed into law over the past year.
Altogether, legislation signed by President Trump over the past year will add roughly $1.9 trillion ($1.6 trillion on a dynamic basis)* to the debt between fiscal year (FY) 2017 and the fiscal year when a hypothetical second term would end in FY 2025. As a result, debt held by the public as a percent of GDP will be 7.5 percentage points higher than it otherwise would have been in the last fiscal year of a two-term Trump Administration. About 85 percent of this comes from the Tax Cuts and Jobs Act and its associated interest costs, with the FY 2017 omnibus signed in May and recent disaster relief bills making up most of the remainder.
Budget Impact of 2017 Legislation Over 8 Years (Billions)
|FY 2017-2025 Savings/ Cost (-)|
|Pre-June Legislation (mostly FY 2017 omnibus)||-$200|
|Disaster Relief Bills||-$51|
|Tax Cuts and Jobs Act (conventional score)||-$1,446|
|Further Additional Continuing Appropriations Act, 2018||-$5|
|Other Legislation (NDAA, veterans' education, etc.)||$0|
|Debt Service Costs||-$239|
|TCJA Dynamic Feedback||$314|
|Terminating Cost-Sharing Reductions||-$168|
|Total w/ Dynamic Feedback, Terminating CSRs, and Change in Debt Service||~-$1,776|
Source: Congressional Budget Office, Joint Committee on Taxation, CRFB calculations.
President Trump took office faced with a daunting fiscal challenge, but the legislation he and Congress have enacted so far has only worsened the federal government's unsustainable budget outlook. As a result, balancing the budget in 10 years as the President's budget and House budget envision would be more difficult, requiring approximately $6.7 trillion in 10-year savings as opposed to the $6.5 trillion claimed in the House budget resolution.
*By 2027, legislation would would add $2.1 trillion to the debt, or $1.7 trillion on a dynamic basis.