Posts Tagged ‘financial disaster’

HOW WILL PRESIDENT TRUMP ELIMINATE ANNUAL FEDERAL BUDGET DEFICITS?

The United States government currently owes over $23 trillion dollars, called the National Debt.   Each year the National Debt is increased by the amount of money the government overspends that year, which is over the amount it collects.  This amount is called the Annual Budget Deficit. When President Obama took office, the National Debt was $9 trillion.  When he left office it was almost $20 trillion.  President Trump continued having hefty budget deficits, mostly because of the higher interest rates on U.S. Treasury bonds that the government is paying, in addition to the cost of bringing back the military to combat-readiness, which had significantly weakened by the underfunding by the Obama Administration.  Consequently, at some point in the next few years, the Federal government may not be able to afford to pay interest on the ever-increasing  National Debt.  This problem is probably the most serious, long-term, one that the U.S. faces.  President Trump is fixing every one of the country’s serious problems so what does he plan to do about this  upcoming financial disaster?  Here’s what he will do, if re-elected, starting now and ending the last year of his 8-year presidency:

President Trump is significantly increasing revenues to the Federal government by stimulating the business environment in the United States through lower corporate, business and income taxes, which has increased the number of people working and the revenues from their taxes, even at reduced tax rates.  He’s also making Americans more prosperous by eliminating unnecessary, job-killing Federal regulations.  Recently, he cut 5% from all Federal Departments.  I initially thought that in a few years the U.S. might not even have a deficit, but with the Federal Reserve increases to the Federal interest rates, the interest on the National Debt is much higher today (about 3 %) than it was when Obama was President ( approx. 1 % ).  This translates into the government paying each year hundreds of billions more for interest on the National Debt than it had been paying only three years ago, and this makes it much more difficult for the government to eliminate its annual budget deficits.

Despite the Federal Reserve increasing interest rates, however, I believe President Trump will still eliminate annual government budget deficits, estimated to be about a trillion in fiscal year 2020, and perhaps also start paying down the National Debt by the end of his second term, with one caveat.  Trump must have a Republican House of Representatives and a Republican Senate in order to put the U.S. financial house in order.  Democrat leaders will do anything to make Trump fail, including preventing his eliminating annual deficits and the reducing the national debt.

In the final phase of eliminating annual budget deficits, President Trump will attempt to eliminate useless and duplicative Federal programs and pare down programs that have shown only meager results.  This will be unpopular with the general public and and a Democrat Congress and that ‘s why he’ll do most of it near the end of his presidency.  How do I know what President Trump will do and when?  Here’s how:

  1. I went to the same school as President Trump, the Wharton School of the University of Pennsylvania, though my Masters was not in finance but from the FEls Government Center, which back when I graduated (1972) was in the Wharon School.  My focus was on government, but there still was some commonality between the two programs though Trump became a billionaire in business and I became a moderate-income Federal employee.
  2. I’ve followed politics for 60 years, beginning with the Kennedy-Nixon TV debates, and have worked for the federal government for over 40 years, a city government for over a year and a State government for less than a year and therefore understand politics and government.
  3. I’ve followed Trump beginning a year before he became President and believe that  I usually know why he does what he does and therefore can explain most of his actions.
Recent Posts