Budget expert: We'll see 'deficits forever' because Congress won't ever balance the budget
The deficit in FY2020 was a record $3.13 trillion, and the national debt is close to $28 trillion.
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The American public will see "deficits forever" because Congress won't ever be able to balance the budget, according to an expert on federal budgetary issues.
Marc Goldwein, senior vice president and senior policy director at the Committee for a Responsible Federal Budget, was asked if he thinks Congress will ultimately be able to achieve a balanced budget at some point after the pandemic is over.
"I suspect we're going to see deficits forever, but it matters how big," Goldwein said during an interview on the "Just the News AM" show. "Small deficits we can handle. We're a very strong country with a strong economy. Large deficits will ultimately overtake us, and if the debt keeps growing faster than the economy, we're going to be in big trouble over the long run."
The deficit in FY2020 was a record $3.13 trillion, according to Treasury Department data, and the national debt is approaching $28 trillion. The federal government last had a budget surplus in 2001.
"I think the most likely scenario is sort of the frog in the boiling water," Goldwein offered. "If you put a frog in cold water and start to boil it, the frog won't even notice. And I think that's the most likely scenario here. Debt chips away at growth, it chips away at growth because people buy bonds instead of investing in the private sector."
"And so it's little by little, you may not notice it year over year," he continued, "but the Congressional Budget Office thinks that our current trajectory is going to slow our growth 20 basis points a year, that's 2% after 10 years, it's almost 5%, after 20 years, after 30 years, it really starts to matter. It means that all of our incomes are going to be lower than they otherwise would have been. And we're not going to understand why."
Goldwein also said the $1.9 trillion stimulus package that President Biden and Democrats in Congress want to pass is much larger than the needs of the country during the pandemic.
"We've already allocated about $4 trillion towards fighting the crisis and the economic crisis," he noted. "I think there is a pretty strong case that that we need some more, particularly when unemployment benefits expire in mid-to-late March, and given the needs of states, but $1.9 trillion is a lot higher than at least what we estimate is necessary.
"The Congressional Budget Office has tried to estimate, what's the output gap over the next three years? Basically, what's the difference between how much the economy will produce and how much it could be producing if there weren't a pandemic? And they think it's about $750 billion. So, you know, you don't need a math degree to know that $1.9 trillion should cover that several times over."