US Debt To Hit $30 Trillion In 2028 Under Trump Budget

On Friday, with the US on the verge of another government shutdown and debt ceiling breach (with the agreement reached only after the midnight hour, literally) Moody's warned Trump  that he should prepare for a downgrade from the rating agency that refused to join S&P in downgrading the US back in August 2011. The reason: Trump's - and the Republicans and Democrats - aggressive fiscal policies which will sink the US even deeper into crippling debt while widening the budget deficit, resulting in "meaningful fiscal deterioration."

In short: a US downgrade due to Trumponomics appears inevitable. And incidentally, with Friday's 2-year debt ceiling extension, it means that once total US debt resets  - unburdened by the debt ceiling - it will be at or just shy of $21 trillion.

Now, following today's release of the White House budget proposal from the Office of the Management and Budget, Moody's will have even greater motivation to downgrade the US as according to the forecast, total US debt is projected to rise from $20.5 trillion today to an unprecedented $29.9 trillion in 2028.

As the next chart shows, the Trump deficit, which is surely on the optimistic side with its projections, anticipates total US debt rising by over $1 trillion for the next 5 years, until 2022, then gradually declining to only $352BN annual increase in 2028.

The good news, as noted earlier, is that Trump’s proposal, which calls for higher spending on military and immigration enforcement and abandons the GOP goal of balancing the budget over decade, is expected to be ignored by Congress. What is unknown is what alternative Congress will come up with, and how much higher the 2028 debt total will end up being.

For now the 10Y does not appear especially concerned, although with a debt-busting recession guaranteed in the next 10 years, it is a virtual certainty that the total debt number in 10 years will be substantially higher than what is projected above.

Comments

bitzager Overfed Mon, 02/12/2018 - 16:57 Permalink

Let's clarify, you cannot pay DEBT with another DEBT, basically (-1) + (-1) = -2  Make sense? So, everybody "Promise to Pay" but never fulfill their obligations... Other thing to consider that US FED (foreign CORP) collateralize entire land of the USA + ("human capital"), so every time they take up more DEBT you should ask for your SHARE of the pie in $$$... Every "Strawman"/"employee" of the USA.corp owes $63k/each so far ("theoretically") but at the end, that's your ASS on that UCC-1 in case of USA.CORP goes belly up... Those Monkey-Asses will be long gone by then..

In reply to by Overfed

bitzager Buckaroo Banzai Mon, 02/12/2018 - 16:14 Permalink

Budget is a HOAX same as MARS space travel... Firstable $30T by when? 2028? Really? Yeah right, it will be there in 3-5 years MAX. 2) What Budget? Person with Printing press in the basement and unlimited credit card, care less about budget this is a story for SHEEP, so they think everyone should leave within their means... People there is NO MONEY! Period, Therefore there is NO BUDGET! It's all accounting, Add ZERO here, minus ZERO there in the computer and it's all looks good...

In reply to by Buckaroo Banzai

justin423 IH8OBAMA Mon, 02/12/2018 - 21:28 Permalink

? I guess basic math is beyond you.  And civics.

the President has nothing to do with the deficit. 

they can propose budgets, but it is the collection of tax and the spending that Congress approves that govern the annual deficit.

And I'll let you in on a little secret.

McConnell and Ryan have been increasing the deficit like crazy with their spending and tax bills.

Trump (and Obama for that matter) has very little to do with it. (and Democrats are not in charge of the House or the Senate, so you really can't blame them either)

Wait until we hit a nasty recession, and the deficit hits 2 trillion in one year under these shitheads.

Wait till Trump proposes to pay holders of US treasuries 50 cents on the dollar in a debt restructuring. Hello economic depression.

 

 

In reply to by IH8OBAMA

SDShack Row Well Number 41 Mon, 02/12/2018 - 15:24 Permalink

Why is anyone surprised by this at this point? I've said it over and over. We now live in a World Wide Debt Ponzi. A Ponzi only exists in 2 states... growing or total collapse. There is no way to taper or unwind a Ponzi. The only people who benefit from a Ponzi are the creators. Almost all of the "investors" get totally wiped out. Plan accordingly.

In reply to by Row Well Number 41

GreatUncle Row Well Number 41 Mon, 02/12/2018 - 16:40 Permalink

If the rate of increasing debt is the new normal.

Any reducion in the rate of increase of the debt will be a recession.

Reckon it will be nearer $40T in 2028 other than that you had a recession.

The thing about recessions is bad debt being removed can create a wiildfire of debt being burned.

Do you think the CB's are clever enough to sustain a controlled recession ... hell no!

In reply to by Row Well Number 41