Republican leaders have delivered on their promises of tax relief for the vast majority of Americans.
Four in five Americans are expected to receive tax cuts under the plan passed by Congress last week. Though the plan is far from perfect, for the millions of American workers who will keep more of their money, tax reform will bring tangible benefits.
However, there are trade-offs. While millions of Americans will receive a boost to their bank accounts, the tax cuts will also necessarily mean less money for the federal government, adding to growing budget deficits and ultimately the national debt.
Before the passage of tax reform, the federal budget was already severely unbalanced, with federal spending far exceeding federal revenues. Tax reform without fiscal discipline and responsibility from Congress will only exacerbate that problem in a big way.
According to the Joint Committee on Taxation, the tax reform plan on President Trump’s desk will reduce federal revenues by $135 billion next year and $280 billion in 2019. That’s on top of prior projections from the Congressional Budget Office released in June that the deficits in 2018 and 2019 would hit $563 billion and $689 billion, respectively.
In other words, the nation finds itself looking at the prospect of $1 trillion budget deficits while the Congress and White House are controlled by Republicans, who at least rhetorically concern themselves with fiscal responsibility.
The pressure should now be on Republican leaders to match their rhetoric with their behavior. Just as the average American can’t get away with spending more while making less, the Congress shouldn’t either.
Achieving this is easier said than done given how profligate and far-reaching the federal government has become. It’s one thing to talk about reducing the deficit and reducing federal spending, but the specifics can be much trickier.
For instance, House Speaker Paul Ryan has suggested in recent weeks that reform of Medicare…