The Worst Budget Deal in History
Monday, July 22, 2019, saw President Trump reach a two year, bipartisan budget agreement with the majority Democratic party leadership in the House of Representatives and the majority Republican party leadership in the U.S. Senate. The deal avoids the potential of another partial shutdown of the U.S. government or defaulting on federal liabilities in early September 2019, while also unleashing much higher spending out of Washington, D.C.
Prior to the agreement, the White House Office of Management and Budget projected the U.S. government would spend $9.691 trillion dollars in its upcoming 2020 and 2021 fiscal years, of which $2.169 trillion would need to be borrowed.
With the bipartisan spending agreement, however, both numbers will be $320 billion higher than without it, with the government set to spend over $5 trillion a year during the next two years. Maya MacGuineas of the Committee for a Responsible Federal Budget had some choice words to say about the new cost of bipartisanship on Capitol Hill:
As we understand it, this agreement is a total abdication of fiscal responsibility by Congress and the President. It may end up being the worst budget agreement in our nation’s history, proposed at a time when our fiscal conditions are already precarious.
If this deal passes, President Trump will have increased discretionary spending by as much as 22 percent over his first term, and enshrine trillion-dollar deficits into law.
Members of Congress should cancel their summer recess and return to the negotiating table for a better deal. If they don’t, those who support this deal should hang their heads in total shame as they bolt town. This deal would amount to nothing short of fiscal sabotage.
That $320 billion increase over two years represents a 3.3 percent increase over the amount the federal government would have spent without the deal. In historical terms, however, that excess pales in comparison to what happened after 2008, when then-President George W. Bush proposed to spend $6.199 trillion in the upcoming 2009 and 2010 fiscal years, a figure that rose to $6.975 trillion over those two years after President Obama and the Democratic party majorities in Congress added their economic stimulus package to the government’s previously planned spending, increasing it by 12.5 percent without bipartisan support.
Today, the nearly $800 billion stimulus is considered a failure. At a cost of nearly two-and-a-half times 2019’s bipartisan spending deal just in raw dollar terms, without any adjustment for inflation, it was far worse. 2009 and 2010 introduced the nation to its first trillion-dollar budget deficits. The 2019 bipartisan budget deal only cements them in the nation’s fiscal fabric for the foreseeable future.
As in 2009 and 2010, it is unlikely that we will see greater prosperity in the future as a result of the 2019 budget deal. It’s a shame that Washington, D.C.’s politicians haven’t learned what they should have from that earlier experience.