Editorial Board

Trump's Budget Is a Waste of Everybody's Time

Budgets are often dead on arrival, but this one is something new.


Photographer: Saul Loeb/AFP/Getty Images

President Donald Trump’s first budget is truly remarkable in its unseriousness. To see why, try for a moment to take it seriously.

The plan purports to be fiscally responsible, saying that the national debt will fall from 77 percent now to 60 percent in 2027. A worthy goal, to be sure. At the same time, it calls for tax cuts but no changes in spending on the two main entitlement programs, Medicare and (non-disability) Social Security. To square these ambitious pledges, the budget then needs either a close-to-impossible acceleration in economic growth, or an implausibly severe squeeze on most other kinds of spending.

With characteristically Trumpian disdain for reality, the budget proposes both.

The Trump administration has until now said its planned tax cuts would pay for themselves by pushing economic growth to 3 percent a year -- a claim already seen as outlandish by every serious analyst, liberal and conservative alike. The budget appears to go one better: It says this boost in growth will be sufficient not just to maintain revenue (despite the cut in rates) but will actually raise revenue by $2 trillion over 10 years compared with current policy. Perhaps somebody just made a dumb mistake, counting the revenue from faster growth twice over. With this administration, it’s wise not to rule it out.

There’s more. The administration’s magical tax reform is “in its very early stages,” as Budget Director Mick Mulvaney generously put it on Monday. Yet to have even the faintest hope of being revenue-neutral, let alone revenue-enhancing, the reform would have to revive the idea of “border adjustment” -- in effect, a tax on imports. The idea has aroused strong opposition from U.S. businesses, the White House has blown hot and cold, and few in Congress think it will be implemented.

Turning to the spending side of the budget, things get no better. The plan includes cuts in Medicaid and other welfare programs so severe that many conservative Republicans are wincing. In all it looks for policy savings of more than $3 trillion over 10 years, without troubling to say how they’ll be achieved. Of this total, $1.4 trillion is projected to come from the administration’s “two-penny plan,” which isn’t a plan at all, just a declaration that eligible discretionary spending will henceforth be cut by 2 percent a year.

Trump’s budget has been almost universally called dead on arrival. That may be an understatement. This plan, if you can call it that, was never capable of life. White House budgets are often set aside, yet still can guide deliberations in Congress, where tax and spending decisions actually get made. This budget serves no such purpose. It is simply an extended tweet, and a waste of everybody’s time.

    --Editors: Clive Crook, Michael Newman

    To contact the senior editor responsible for Bloomberg View’s editorials: David Shipley at davidshipley@bloomberg.net .

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