'Does The Math Add Up?': Whitehouse Blasts Trump Over Tax Plans That 'Added To The National Debt'

8/5/2024

During a Senate Budget Committee hearing prior to the Congressional recess, Sen. Sheldon Whitehouse (D-RI) questioned Congressional Budget Office Director Phillip Swagel about the impacts of former President Trump's tax plans, and healthcare spending in the US.

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Transcript

00:00Thank you very much Director. The CBO about two months ago released new

00:13estimates that project that an extension of the 2017 Trump tax cuts would add

00:204.6 trillion dollars to the debt over 10 years. Is that correct?

00:24Yes that's correct. And does CBO believe that the original 2017 Trump tax cuts

00:32paid for themselves? And does any CBO data support that extension of these tax

00:39cuts would pay for themselves? No there was a effect of the tax cuts on

00:46the economy and back to revenues but by far it did not pay for itself and the

00:51same would apply for the extension of the 2017 Act. CBO's long-term budget

00:58projections back in 2012 were the last time that CBO showed debt declining as a

01:06share of GDP. Since then Congress has cut taxes numerous times including

01:11extending most of the Bush tax cuts and then piling on the 2017 Trump tax cuts.

01:17Is it a fact Director Swagel that projected primary spending that is

01:22federal non-interest spending is now lower than it was projected to be in

01:272012? That that's correct and the interest payments have gone up but as

01:32you said the non-interest payments have gone down. So let me just to put this

01:35into context let's take a look at this graphic here which shows from 1994 to

01:432054 how revenues and spending have worked. Social Security has gone up and

01:51is that consistent with an aging population? That's right that that

01:55results from the aging population. And health care spending has gone up even

02:00more does that also relate to an aging population? Right that's both the aging

02:03population and rapid growth in health costs. So other mandatory spending had a

02:08huge surge right here. Can you explain what that was? Was that COVID? That's

02:13COVID and you know the spending because of the you know the Senate rules the

02:19spending in the reconciliation bill I'm sorry the COVID spending and then the

02:232021 reconciliation spending was all mandatory. Yes and then here's defense

02:29discretionary spending and then this is non defense discretionary spending which

02:35as you can see has been fairly constant over all of those years. This is the

02:42place for our Republican friends want to focus all of their attention related to

02:49debt and deficits but I think as we can see even if you zeroed that out we still

02:54wouldn't get out of our problems correct? No that's correct that even if

03:00discretionary spending was entirely eliminated that that wouldn't take the

03:06deficit to zero. Great and then as ever has been pointed out interest costs or

03:11what are going up that's the biggest number and is it true that tax cuts have

03:19an effect on the interest obligations of the country? That's right the rising

03:24interest payments as you noted reflect both higher interest rates and also more

03:28debt and the tax cuts lead to less revenue which mean more debt. Yep so

03:35what I've added here this is what our actual revenue has looked like. If the

03:43Bush tax cuts had not been extended back in 2012 here's what our revenue would

03:50look like. We'd be darn close to operating in an effective way so you can

03:59ascribe an enormous amount of our problem to the extension of the Bush tax

04:03cuts according to are these numbers correct? Can you vouch for the extension

04:08of the Bush tax cuts having that much of an effect on revenues? You know I'd have

04:13to look at it I just I haven't you know I from this distance I can't see it but

04:18but certainly the 2012 extension of the 2001 and 2003 tax acts had an effect on

04:25revenues as you said. A pretty massive effect on debt and on deficits because

04:30of lost revenues correct? That's right yes.

04:39If you look at what's been added to the national debt this is Trump time

04:483.6 trillion was added and that was COVID relief so we can understand that

04:54was a little bit of an emergency but 4.8 trillion was non-COVID added to the debt.

05:02By contrast there's still 2.1 trillion left under Biden but 2.2 trillion in

05:10non-COVID so does the math add up that under Biden the addition to the debt is

05:19less than half than under Trump? I mean I you know I'd have to look at the

05:23numbers but as you said the debt debt the dollars of debt and the debt ratio

05:28went way up especially during the pandemic but even before that the debt

05:32ratio went up. Senator Grassley.

'Does The Math Add Up?': Whitehouse Blasts Trump Over Tax Plans That 'Added To The National Debt'

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