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New US debt in 2018 highest since recession

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Paul Ryan US national debt
Paul
Ryan speaks in front of the campaign’s “national debt clock” in
Dover, New Hampshire.

Brian
Snyder/Reuters


  • The federal government will issue $1.34 trillion in new debt
    during 2018, according to a new Treasury Department projection.
  • The debt issuance represents a 146% jump from 2017 and the
    highest amount of new debt issued since 2010.
  • The report comes weeks after the Treasury said the fiscal
    year 2018 budget deficit hit $779 billion, the largest since
    2012.
  • The primary drivers of new debt issuance are the GOP tax law
    and the bipartisan budget agreement.

The federal government will issue more than $1.3 trillion in debt
in 2018, according to a new estimate released by
the Treasury Department
on Monday, the highest total debt
issuance since the depths of the Great Recession:

  • Total net marketable securities issued in the fourth quarter
    will be a projected $425 billion, according to the Treasury
    report.
  • That will bring total debt issued in 2018 to $1.34 trillion,
    the highest since $1.59 trillion was issued in 2010.
  • 2018 debt issuance also jumped 146% from 2017, when just $546
    billion was issued.

The numbers come after the Treasury announced in early October
that
the budget deficit for fiscal year 2018
(which ran from
October 2017 through September) hit $779 billion, a 17% jump from
the previous fiscal year and the highest level since 2012.

The deficit is expected to come in just shy of $1 trillion for
fiscal year 2019 and will eclipse the $1 trillion mark in the
following four years, according to official Trump administration
estimates.

The ballooning debt load is primarily the result of newly passed
legislation including the GOP tax reform law and the bipartisan
budget deal.

According to the Treasury, federal revenue growth was sluggish in
fiscal year 2018 primarily due to a drop in corporate tax
revenue. The GOP law is expected to add $1.5 trillion in debt
over the next 10 years. At the same time, higher levels of
spending from the budget deal caused overall spending to jump.

Recently, Republican leaders, including members of the Trump
administration, have
pointed to the growing deficit as an example
of why it is
necessary to cut entitlement programs like Medicare and Social
Security.

Democrats, on the other hand, want to reverse some provisions of
the GOP tax law to increase revenue and close the gap that way.

Early polling shows that
most Americans would prefer
Congress deal with the deficit
and debt by reversing the tax law’s cuts rather than reducing
spending on entitlements.

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