THE HUESSY REPORT JULY 8
Weekly Report from Peter Huessy, President of Geostrategic Analysis of Potomac, Maryland, to the Montgomery County people
This weekly report is very brief given the 4th of July celebration. This report is on the debt incurred over the past four years and prospects for the next decade. Information is from Tom Moore and his Unleash Prosperity daily report with some small edits.
The Congressional Budget Office forecasts an increase in debt considerably more under Biden’s plans vs. those in place in January 2021.
In other words, the CBO now expects the debt to be $7.2 trillion higher than it had projected when Trump left office — all because of Biden’s reckless spending policies. And even though CBO sees tax rate reductions as restricting revenue and tax rate increases as always bringing in the anticipated revenue.
Also, Treasury Department figures also show the debt growing much faster under Biden.
Over Trump’s entire term, including the 2020 spate of emergency COVID spending, the debt increased by $7.7 trillion — a staggering total, to be sure.
However, about 15% of that debt total was the result of Treasury’s choice to keep additional cash on hand during the pandemic.
Former Treasury Secretary Steve Mnuchin, unsure how much tax revenue would be collected, borrowed well over $1 trillion — but kept it in reserve, without ever spending it. However, of the net $6.7 trillion, $2 trillion of the debt was due to one bill--the COVID relief funds. In short, under Trump debt was roughly $1 trillion a year---much to high indeed.
But Biden, however, spent that reserve, then borrowed another $7 trillion on top of it just over 3 ½ years. The current annual debt now approaches $2 trillion a year with $800 billion more being borrowed between July-September, to the end of the fiscal year.
In addition, instead of simply allowing that one-time emergency COVID spending to expire, Biden and the Democratic Congress continued spending at that same COVID-era level, thus institutionalizing multitrillion-dollar deficits.
In short, accounting for the changes in cash balances at the Treasury, the debt actually rose $6.5 trillion during Trump’s entire term — and is up $7.9 trillion in less than four years of Biden’s tenure.
Worse, the Treasury has announced that it anticipates needing to borrow another $800 billion from July through September of this year, followed by hundreds of billions more from October to December as federal finances further deteriorate. L told; Biden will likely oversee a net increase i.e., debt of more than $9 trillion in a single term — a new record.
Biden wanted to spend $2 trillion more in the last year and a half, but conservatives in the House blocked the added bloat.
You can bet the farm that if the radical left wins the White House and Congress in 2024, that $2 trillion outlay will be first on their legislative agenda.
Biden’s other big lie, backed by the CRFB analysis, is that extending Trump’s tax reform will drown the economy in debt.
Yet federal tax revenues have increased since that tax reform was enacted — and federal revenues as a share of GDP have not fallen.
All of the increase in today’s debt has been due to massive, out-of-control federal spending — by both parties.
Trump spent and borrowed too much, full stop.
But with a debt headed to $50 trillion if reelected and a political agenda that stifles economic growth, Biden has set America on an unsustainable fiscal path that will lead to financial oblivion.
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Peter Huessy is a Member of the Montgomery County Republican Central Committee. Since 1981 he has been President of Geo-Strategic Analysis of Potomac, Maryland. He was a former special assistant to the Secretary of the Interior and consultant to the US Air Force. He can be reached at [email protected]