The Trump Budget's $1.2 Trillion in 'Phantom Revenues'
President Trump’s 2020 budget includes up to $1.2 trillion in “potentially phantom revenues” — money that comes from taxes the administration opposes or from tax hikes that face strong opposition from businesses, The Wall Street Journal’s Richard Rubin reports, citing data from the Committee for a Responsible Federal Budget. That total, covering 2020 through 2029, includes as much as $390 billion in taxes created under the Affordable Care Act, which the president wants to repeal.
The $1.2 trillion in questionable revenue projections is in addition to the White House budget’s projected deficits of $7.3 trillion for the 10-year period. That total is itself questionable, given that the president’s budget relies on optimistic assumptions about economic growth and some unrealistic spending cuts, meaning that the deficits could be significantly higher than projected.
Pentagon Pushes for Faster F-35 Cost Cuts
The Pentagon has taken over cost-cutting efforts for the F-35 program, which has been plagued by years of cost overruns, production delays and technical problems. The Defense Department rejected a cost-saving plan proposed by contractors including principal manufacturer Lockheed Martin as being too slow to produce substantial savings. Instead, it gave Lockheed a $60 million contract “to pursue further efficiency measures, with more oversight of how the money was spent,” The Wall Street Journal’s Doug Cameron reports. F-35 program leaders “say they want more of the cost-saving effort directed at smaller suppliers that haven’t been pressured enough.” The Pentagon plans to cut the price of the F-35A model used by the Air Force from a recent $94.6 million each to around $80 million by 2020. Overall, the price of developing the F-35 has climbed above $400 billion, with the total program cost now projected at $1.53 trillion. (Wall Street Journal, CNBC)
Chart of the Day - October 6, 2017
Financial performance for insurers in the individual Obamacare markets is improving, driven by higher premiums and slower growth in claims. This suggests that the market is stabilizing. (Kaiser Family Foundation)
Quote of the Day - October 5, 2017
"The train's left the station, and if you're a budget hawk, you were left at the station." -- Rep. Mark Sanford, R-S.C.
Big Ad Buys to Push Tax Reform
Two conservative groups are spending millions to promote an overhaul of the tax code.
The American Action Network announced Thursday that it will spend $2 million on a new TV ad featuring a Midwestern mom who says her family is “living paycheck to paycheck” and that a middle class tax cut would give them “piece of mind.” The ad will air in 28 congressional districts currently held by Republicans. Americans for Prosperity, backed by the Koch brothers, will spend $4.5 million on ads that promote tax reform while criticizing three red-state Democratic senators -- Claire McCaskill (MO), Tammy Baldwin (WI) and Joe Donnelly (IN).