Both of the proposed economic plans from Vice President Kamala Harris and former President Donald Trump would likely add trillions of dollars to the national debt , according to a new study.
The Committee for a Responsible Federal Budget, a group that advocates increased fiscal restraint, released a new analysis of the candidates’ economic plans Monday. The report notes that there is a large amount of uncertainty about the plans but finds that both will add to the federal government's growing debt and deficits.
Harris’s plan is expected to increase the national debt, which is now sitting at about $35.7 trillion, by about $3.5 trillion over the next decade. For context, that would represent a 9.8% increase over the next 10 years.
The $3.5 trillion figure is the central estimate of Harris’s economic plan’s effects on the budget. The analysis finds that it is possible, on the low end, that her plan would be about deficit-neutral. On the high estimate of costs, it would add more than $8 trillion to the debt.
When contacted by the Washington Examiner, a Harris spokesperson disputed the CRFB analysis and committed that Harris’s plan would reduce the deficit, pointing to alternative viewpoints on the plan’s effect on deficits.
Trump’s plan would shackle the United States with even more debt, according to the CRFB. Under the group’s central estimate, Trump’s plan would add $7.5 trillion to the national debt, a 21% increase through 2035. The fiscal impact of Trump’s proposals ranges from $1.45 trillion on the low end to more than $15 trillion. One major factor in Trump's larger price-tagged plan is his call for new major tax cuts for certain groups, including the elimination of income taxes on tips and Social Security benefits.
Brian Hughes, senior adviser to the Trump campaign, also pushed back on the analysis in a statement. He panned Harris for helping pass the 2022 Inflation Reduction Act, which was opposed by all Republicans in Congress.
“President Trump’s historic tax cuts laid the foundation for robust, non-inflationary growth that fueled more revenue for the federal government, not less,” he said. “Meanwhile, the Kamala Harris approved Inflation Reduction Act is now projected to add $300 billion to the deficit. President Trump's plan will rein in wasteful spending, defeat inflation, reduce the burden of interest costs, and ignite economic growth that fuels federal revenue so we can make our economy great again.”
The biggest cost in both plans involves extensions and modifications to the 2017 Tax Cuts and Jobs Act, also known as the Trump tax cuts. Many provisions of the law expire next year, so extending or changing them is a major priority for both candidates.
Harris and Democrats have criticized the Trump tax cuts as a giveaway to the wealthy and corporations, but the TCJA lowered taxes for the overwhelming majority of people. An analysis by the Tax Policy Center, a left-of-center Washington think tank, found that 80.4% of taxpayers received tax cuts across the income spectrum.
Harris, similar to President Joe Biden, has vowed not to raise taxes on those earning less than $400,000 annually, so her administration would have to extend some provisions in the Trump tax cuts to keep that promise. That would cost the Treasury an estimated $3 trillion over 10 years, according to the CRFB.
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The CRFB found that the central estimate for the cost of Trump’s extensions and modifications to the 2017 law would be $5.4 trillion over the next decade.
One key revenue-raising proposal that Trump supports and Harris does not is a massive ramp-up of tariffs. Trump has proposed a baseline tariff policy for countries across the board and has largely floated 10% tariffs. He has also called for bruising 60% tariffs on China. The central estimate for how much that would raise is $2.7 trillion, according to the CRFB.
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