Trump Tax Plan Contains $2 Trillion Error

Money Bag. Photo By Barbara Lock [CC0], via Wikimedia Commons

Photo By Barbara Lock

by Christopher Bates

On July 22, 1962, the Mariner I was launched after years of planning and preparation. Its mission, in the midst of the space race, was to conduct a flyby of Venus. Mariner never made it, since it exploded five minutes after takeoff. The reason? A missing dash in the mathematical coding done by NASA. It’s famously known as the “$80 million punctuation error.”

That $80 million is equivalent to a bit more than $650 million today. Still, if any of those scientists are still with us, they can sleep a little better, because their mistake is a drop in the bucket compared to the accounting error in Donald Trump’s budget. In brief, it assumes that the cost of the President’s proposed tax cuts will be canceled out by increased tax revenues. At the same time, it also assumes that the economy will grow rapidly enough that the government will be able to afford $1.3 trillion in new spending thanks to all the new tax revenue it will collect. In other words, Trump is counting on the same exact money to offset the loss of tax income and to cover the cost of new expenditures. Even if we grant all of Trump’s other assumptions (which is granting a lot), correcting for the accounting error means that the President’s plan will blow a $2 trillion hole in the budget. In an editorial for the Washington Post, former Treasury secretary Lawrence Summers was disdainful, describing the oversight as an “elementary double count” and “a logical error of the kind that would justify failing a student in an introductory economics course.” When the issue was pointed out to current Treasury secretary Steve Mnuchin, he said, “This is a preliminary document that will be refined.” Not exactly a response that does justice to the seriousness of the problem. (Z)

Courtesy of ElectoralVote

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