The federal budget remains a disaster, and for all the discourse of cost reduction of costs and income focused on prices, the Americans know it. In particular, the last budget wreck is supervised by an administration which has promised a business sense and a conservative detention. The Republicans deliver the opposite: self-inflicted destruction of wealth, an increase in interest rates, fears of creeping inflation and an abandonment of their usual claim of tax discipline.
The new results of the national financial policies of the Cato Institute confirm That Americans do not trust politicians to manage our money. According to seventy percent, the federal government spends too much. An astonishing 85% says that frequenting the last decade has had no impact on their quality of life or has worsened.
It is an overwhelming indictment of Superb deficits from the first Trump administrationDéouanne of the administrative expenses of Biden and Republicans who, until very recently, have at least pretended to worry about mental health, in particular to be realistic as to the need to reform the rights programs.
Ninety-eight percent of Americans think that there are at least certain waste, fraud and abuse in federal expenses, and two thirds think that there is one plot. The public now estimates These 59 cents of each federal dollar are wasted – the highest amount recorded since Gallup began to ask this question in 1979.
This is not the point of view of a crank minority: ninety-nine percent of the Americans, including 99% of the Republicans, support a full audit of federal expenses.
You might think that it would be an alarm clock, especially when the image of the debt deteriorates so quickly. According to the Treasury Department, from this month – halfway through the exercise – we have already displayed A deficit of $ 1.3 billion. Interest payments alone have crossed the $ 500 billion mark, eliminating almost everything else. So much for “low interest rates forever” fantasy.
Regarding these high interest rates: one of the most absurd economic concepts floated by the Trump administration is that the prices, by the rattling markets as they did last week, would help. Supposedly, panicked investors would flee the American treasury bills, reduced interest rates and allowing a cheaper refinancing of debt. It was the theory, in any case, until the markets were so badly crushed that investors began to empty the obligations and the rates increase.
The key problem is the financial columnist Jon Sindreu describe Like the administration “overwhelming the world trading system”. Instead of making government debt safer, it made investors suspicious of having American financial assets. The yield on the bonds of the Treasury at 10 years has since increased, not down.
This is particularly disturbing since around a third of public debt matures in less than a year. The protectionist policy collided with the carelessness, and the upcoming refinancing will bring an expensive tab instead of relief. We will pay more to borrow than ever.
Let's not forget inflation. Speaking during a business journalism conference, the president of the federal reserve Jerome Powell declared The fact that Trump's prices were “significantly higher than expected” and their economic effects – including higher inflation and slower growth – are probably substantial. The fight against inflation will require an increase in interest rates, which will again increase interest payments and the deficit.
In addition to this, Republicans are preparing to extend Trump tax reductions. There are reasonable means to doBut they seem ready to contact new cuts, some more politically motivated than economically. This comes without spending reductions or structural reforms necessary to compensate for the loss of income. The result? A hot air balloon deficit, a drop -down income base and no long -term plan. It is not the economy of supply. It is a magical thought.
Ok, but what happens if the prices increase billions of thousands In income, as administration officials boasted? It is not a victory.
No, it's just another way of saying that they have taken the highest increase in tax in the history of the United States on American consumers. And this is certainly not what the voters had in mind when they heard “America first”. We should not count on this income, if he never materializes, to reduce debt compared to GDP. Budget adjustments based on higher taxes do not generally do so. However, they slow the economy short and long -term.
And what about Doge, the so-called Ministry of Government Effectiveness? Well, apparently Elon Musk and his team will cut 150 billion dollarsnot it “At least” 2 billions of dollars once promised. I am grateful to cut the expenses, but let's face it, it is a drop in the bucket of red ink.
Republicans cannot continue to sleep in the same budgetary errors as Democrats have committed by exchanging long -term stability for a short -term political gain, exploding the convenience budget and hoping that voters do not notice it. Because voters are to remark.
They know that Washington wastes their money. They know that budget deficits are important. And they are desperate for someone – anyone – to act as a responsible adult. The question is whether the Republicans, who still have a change of change, will answer the call.
Veronique de Rugy is main researcher at the George Mason University Mercatus Center. This article was produced in collaboration with the union creators.
