CBO Quietly Revises GDP Growth Outlook Upwards
While the media worries about deficits (which are bad), it ignores the benefits of tax cuts.
Much of the mainstream media’s attention has been focused on the Congressional Budget Office’s report that the federal deficit would top $1 trillion by 2020, blaming Republican tax reform for it. Typical is this Reuters headline: “U.S. budget deficit to balloon on Republican tax cuts.” But the MSM has largely overlooked or ignored a major point of revision within the CBO report. Last year, the CBO surmised that the Republican tax cuts would have little immediate impact on the nation’s economic growth and estimated 2018 GDP at just 2%. That estimate has now been revised up to 3.3% — not a small adjustment. The CBO has also adjusted its 2019 estimates up to 2.4% from what was only 1.5% GDP growth.
Now the CBO is estimating GDP to be $6.1 trillion more by 2027 than its pre-tax cut estimates. Essentially, what the CBO is now saying (albeit not too loudly) is that the tax cuts are paying for themselves. So why all the bad news on a growing budget deficit? As is typical of big government, the fault lies not with tax cuts, as they are proving to create revenue and economic growth. Instead, it’s a convenient excuse designed to avoid the real issue: Government has a spending problem, especially with entitlements. As CNS News reports, “The federal government collected a record $736,274,000,000 in individual income taxes through the first six months of fiscal 2018” — and it still ran a deficit of $599.7 billion.
Too many lawmakers simply refuse to accept a fact that has been demonstrated time and again: People who are free to keep and spend more of their own money as they see fit have a greater positive impact on economic growth and development than a bunch of elitist bureaucrats in Washington taxing us in order to fund their special interest projects.
(Edited.)