Comment by MR4D
7 days ago
The deficit is 2 trillion.
Income taxes on individuals are 2.4 trillion.
How much do you expect to raise taxes to cover that gap? You double my taxes and I’m in the welfare line.
Further, and this is not referenced enough - the US must rollover ~9 trillion in treasuries this year. The lower the interest rate to do that, the better. Otherwise it increase the deficit even more.
The only way this ends is one of two paths - a path similar to what we are on; default.
We may not like this one, but default is world destroying because of the broad use of the Dollar around the globe.
The deficit is not in fact 2 trillion. Source: https://www.bea.gov/system/files/trad0225.png (and many other official documents)
Also, this is a false dichotomy.
In CBO’s projections, the federal budget deficit in fiscal year 2025 is $1.9 trillion. Adjusted to exclude the effects of shifts in the timing of certain payments, the deficit grows to $2.7 trillion by 2035. It amounts to 6.2 percent of gross domestic product (GDP) in 2025 and drops to 5.2 percent by 2027 as revenues increase faster than outlays
https://www.cbo.gov/publication/60870
IMO, 5%+ percent of gross domestic product (GDP) in a country with massive trade deficits is not sustainable.
"The budget projections are based on CBO’s economic forecast, which reflects developments in the economy as of December 4, 2024. They also incorporate legislation enacted through January 6, 2025."
Out of date!
Nominal GDP growth was 5% in December. As long as share of GDP is constant things are sustainable.
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I think they meant budget deficit, whereas you refer to trade deficit.
That graph shows a 130B monthly deficit. So maybe not 2B but still 1.5B on a yearly basis.
I believe the OP was talking about the fiscal deficit, your chart shows the trade deficit.
The current administration has no interest in reducing the fiscal deficit. Their expressed policies will make it larger.
Taxes should be raised on the rich. Elon Musk alone is worth $330 billion. There is plenty of money to pay for what we need. The question is whether we can muster the political will to do it.