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Budget office expects $2.3T deficit before Biden relief plan

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FILE - In this March 5, 2018 photo, the East Front of the U.S. Capitol at sunset in Washington. (AP Photo/Alex Brandon)

BALTIMORE (AP) — The Congressional Budget Office says the federal government is on track for a $2.3 trillion deficit this year, down roughly $900 billion from last year when the coronavirus pandemic led Congress to provide historic amounts of financial aid.

Stronger economic growth has helped to reduce the anticipated shortfall for this year. Still, the deficit could soon be revised upward if President Joe Biden’s $1.9 trillion coronavirus relief package becomes law. The additional aid — coming after roughly $4 trillion was approved last year — would add more red ink once enacted, but isn’t included in Thursday’s CBO projections.

Excluding the Biden plan, this year’s deficit will equal 10.3% of gross domestic product, which is a measure of the total value of the economy’s goods and services. The past two years have the highest deficits relative to GDP since 1945.

The CBO expects the budget deficit to fall to about $1 trillion in 2022 as the economy heals and there is less need for government spending. Deficits are supposed to average 4.4% of GDP from 2022 to 2031.

Several decades of deficit spending has meant that the total federal debt held by the public is slightly larger than GDP. That figure is projected to rise to 107% of GDP by 2031 as spending on Medicare and Social Security increases.

Shai Akabas, economic policy director at the Bipartisan Policy Center, said that additional coronavirus relief should be a priority, cautioning that the country still needs to find a way to put the deficit on a safer path.

“When it comes to recovery, the country faces many challenges that are likely to require an infusion of federal resources,” Akbas said. “But it is crucial that lawmakers balance any new investment with a commitment to stabilizing the precarious fiscal picture that CBO highlighted today. In this realm, ‘wait and see’ is not a strategy — it is a fiscal risk.”

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1 Comment

  1. Ronald Walker

    February 12, 2021 at 3:42 pm

    See what is included with the virus / relief bill listed below.
    How can we ever move forward as a country if we don’t take care of this virus first?

    website for HR 748 from 116th Congress. Here’s the direct link: https://www.congress.gov/bill/116th-congress/house-bill/748

    American population: 330,483,530
    Stimulus bill: $2,000,000,000,000 ($2 Trillion)
    Dividing the cost by every American is $6,051.74 The government could have given every person over $6,000, but instead will give $1,200 to each adult under a certain income. Want to know where the missing 96% of your tax dollars went? Here you go. . .

    1. $300,000,000 for Migrant and Refugee Assistance pg.. 147
    2. $10,000 per person for student loan bailout
    3. $100,000,000 to NASA, because, who knows why.
    4. $20,000,000,000 to the USPS, because why the hell not
    5. $300,000,000 to the Endowment for the Arts – because of it
    6. $300,000,000 for the Endowment for the Humanities/ because no one even knew that was a thing
    7. $15,000,000 for Veterans Employment Training / for when the GI Bill isn’t enough.
    8. $435,000,000 for mental health support
    9. $30,000,000,000 for the Department of Education stabilization fund/ because that will keep people employed (all those zeros can be confusing, that’s $30 BILLION)
    10. $200,000,000 to Safe Schools Emergency Response to Violence Program
    11. $300,000,000 to Public Broadcasting / NPR has to be bought by the Democrats.
    12. $500,000,000 to Museums and Libraries / Who the hell knows how we are going to use it.
    13. $720,000,000 to Social Security Admin / but get this only 200,000,000 is to help people. The rest is for admin costs.
    14. $25,000,000 for Cleaning supplies for the Capitol Building / I kid you not it’s on page 136.
    15. $7,500,000 to the Smithsonian for additional salaries
    16. $35,000,000 to the JFK Center for Performing Arts
    17. $25,000,000 for additional salary for House of Representatives
    18. $3,000,000,000 upgrade to the IT department at the VA
    19. $315,000,000 for State Department Diplomatic Programs
    20. $95,000,000 for the Agency of International Development
    21. $300,000,000 for International Disaster Assistance
    22. $90,000,000 for the Peace Corp pg. 148
    23. $13,000,000 to Howard University pg. 121
    24. $9,000,000 Misc. Senate Expenses pg. 134
    25. $100,000,000 to Essential Air carriers pg. 162. This of note because the Airlines are going to need billions in loans to keep them afloat ($100,000,000 is chump change.)
    26. $40,000,000,000 goes to the Take Responsibility to Workers and Families Act This sounds like it’s direct payments for workers pg. 164.
    27. $1,000,000,000 Airlines Recycle and Save Program pg. 163
    28. $25,000,000 to the FAA for administrative costs pg. 165
    29. $492,000,000 to National Railroad Passenger Corporation (Amtrak) pg. 167
    30. $526,000,000 Grants to Amtrak to remain available if needed through 2021 pg. 168 (what are the odds that doesn’t go unused) Hidden on page 174 the Secretary has 7 days to allocate the funds & notify Congress.
    31. $25,000,000,000 for Transit Infrastructure pg. 169
    32. $3,000,000 Maritime Administration pg. 172
    33. $5,000,000 Salaries and Expensive Office of the Inspector General pg. 172
    34. $2,500,000 Public and Indian Housing pg. 175
    35. $5,000,000 Community Planning and Development pg. 175
    36. $2,500,000 Office of Housing

    What DOES ALL of this have to do with the Virus????

    (Are you angry yet? This information should be shared with everyone on your contact/mail list.)

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