Wishful Thinking Won't Solve the US Debt Crisis
The budget plan taking shape in Congress is likely to add some $4 trillion to the national debt over the next 10 years. The ratio of public debt to gross domestic product is already close to 100%, about as high as at the end of World War II, and rising steadily. Even without new tax cuts now on the table, the debt-to-GDP ratio is on track to exceed 160% over the next few decades.
A lot of economists aren't much concerned about this. In a new paper, Wendy Edelberg, Benjamin Harris and Louise Sheiner of the Brookings Institution join the ranks of the calmly complacent. Their argument is far from reassuring.
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17 minutes ago
Trump's tariffs could pay for his tax cuts -- but it likely wouldn't be much of a bargain
WASHINGTON -- WASHINGTON (AP) — The tax cuts in President Donald Trump's One Big Beautiful Bill Act would likely gouge a hole in the federal budget. The president has a patch handy, though: his sweeping import taxes — tariffs. The Congressional Budget Office, the government's nonpartisan arbiter of tax and spending matters, says the One Big Beautiful Bill, passed by the House last month and now under consideration in the Senate, would increase federal budget deficits by $2.4 trillion over the next decade. That is because its tax cuts would drain the government's coffers faster than its spending cuts would save money. By bringing in revenue for the Treasury, on the other hand, the tariffs that Trump announced through May 13 — including his so-called reciprocal levies of up to 50% on countries with which the United States has a trade deficit — would offset the budget impact of the tax-cut bill and reduce deficits over the next decade by $2.5 trillion. So it's basically a wash. That's the budget math anyway. The real answer is more complicated. Actually using tariffs to finance a big chunk of the federal government would be a painful and perilous undertaking, budget wonks say. 'It's a very dangerous way to try to raise revenue,' said Kent Smetters of the University of Pennsylvania's Penn Wharton Budget Model, who served in President George W. Bush's Treasury Department. Trump has long advocated tariffs as an economic elixir. He says they can protect American industries, bring factories back to the United States, give him leverage to win concessions over foreign governments — and raise a lot of money. He's even suggested that they could replace the federal income tax, which now brings in about half of federal revenue. 'It's possible we'll do a complete tax cut,'' he told reporters in April. 'I think the tariffs will be enough to cut all of the income tax.'' Economists and budget analysts do not share the president's enthusiasm for using tariffs to finance the government or to replace other taxes. 'It's a really bad trade,'' said Erica York, the Tax Foundation's vice president of federal tax policy. 'It's perhaps the dumbest tax reform you could design.'' For one thing, Trump's tariffs are an unstable source of revenue. He bypassed Congress and imposed his biggest import tax hikes through executive orders. That means a future president could simply reverse them. 'Or political whims in Congress could change, and they could decide, 'Hey, we're going revoke this authority because we don't think it's a good thing that the president can just unilaterally impose a $2 trillion tax hike,' '' York said. Or the courts could kill his tariffs before Congress or future presidents do. A federal court in New York has already struck down the centerpiece of his tariff program — the reciprocal and other levies he announced on what he called 'Liberation Day'' April 2 — saying he'd overstepped his authority. An appeals court has allowed the government to keep collecting the levies while the legal challenge winds its way through the court system. Economists also say that tariffs damage the economy. They are a tax on foreign products, paid by importers in the United States and usually passed along to their customers via higher prices. They raise costs for U.S. manufacturers that rely on imported raw materials, components and equipment, making them less competitive than foreign rivals that don't have to pay Trump's tariffs. Tariffs also invite retaliatory taxes on U.S. exports by foreign countries. Indeed, the European Union this week threatened 'countermeasures'' against Trump's unexpected move to raise his tariff on foreign steel and aluminum to 50%. 'You're not just getting the effect of a tax on the U.S. economy,' York said. 'You're also getting the effect of foreign taxes on U.S. exports.'' She said the tariffs will basically wipe out all economic benefits from the One Big Beautiful Bill's tax cuts. Smetters at the Penn Wharton Budget Model said that tariffs also isolate the United States and discourage foreigners from investing in its economy. Foreigners see U.S. Treasurys as a super-safe investment and now own about 30% of the federal government's debt. If they cut back, the federal government would have to pay higher interest rates on Treasury debt to attract a smaller number of potential investors domestically. Higher borrowing costs and reduced investment would wallop the economy, making tariffs the most economically destructive tax available, Smetters said — more than twice as costly in reduced economic growth and wages as what he sees as the next-most damaging: the tax on corporate earnings. Tariffs also hit the poor hardest. They end up being a tax on consumers, and the poor spend more of their income than wealthier people do. Even without the tariffs, the One Big Beautiful Bill slams the poorest because it makes deep cuts to federal food programs and to Medicaid, which provides health care to low-income Americans. After the bill's tax and spending cuts, an analysis by the Penn Wharton Budget Model found, the poorest fifth of American households earning less than $17,000 a year would see their incomes drop by $820 next year. The richest 0.1% earning more than $4.3 million a year would come out ahead by $390,070 in 2026. 'If you layer a regressive tax increase like tariffs on top of that, you make a lot of low- and middle-income households substantially worse off,'' said the Tax Foundation's York. Overall, she said, tariffs are 'a very unreliable source of revenue for the legal reasons, the political reasons as well as the economic reasons. They're a very, very inefficient way to raise revenue. If you raise a dollar of a revenue with tariffs, that's going to cause a lot more economic harm than raising revenue any other way.''
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17 minutes ago
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US presidents ranked by their approval ratings when they left office
For the past 70 years, Gallup has measured US presidents' approval ratings. Bill Clinton had the highest approval ratings at the time he left the Oval Office. Donald Trump's first-term rating is tied for eighth place with George W. Bush's and Jimmy Carter's. President Donald Trump is seeking to rewrite US immigration policies, has reshaped how world leaders use social media, and has made historic changes to the federal workforce. But in his first term, he made history in a way he may wish to forget: He was the first president since Gallup began tracking presidential job approval in the 1930s to fail to exceed a 50% approval rating at any point during his term. In Gallup's latest poll, conducted during the first half of May, 43% of respondents said they approved of Trump's performance, down from 47% in polling conducted during the first six days of his second term in January. In the recent poll, 53% said they disapproved of his handling of the presidency. This number has held steady since March, a month rocked by leaked Signal chats and the economic shake-up of tariff policies. (A handful of people in each poll said they had no opinion of Trump's job performance.) For nearly a century, the polls have been used to measure the public's perception of US presidents' performance, with Gallup asking Americans: "Do you approve or disapprove of the way [the current president] is handling his job as president?" The American Presidency Project from the University of California, Santa Barbara, compiled the final Gallup ratings of each president's term from the past 70 years, signaling how popular each leader was when they left the Oval Office. See how US presidents from Harry Truman to Joe Biden rank in this end-of-term polling. We've ordered them from the lowest approval rating to the highest. Richard Nixon Approval rating: 24% Even though Nixon won the 1972 election in a historic landslide, the end of his presidency was tainted by the Watergate scandal that led him to resign on August 9, 1974, when faced with the threat of an impeachment and removal. Surveyed August 2 to 5, 1974, after the House Judiciary Committee passed articles of impeachment against the president but before he resigned, 66% of respondents to the Gallup poll said they disapproved of Nixon's presidency, the highest of any president on the list. Harry S. Truman Approval rating: 32% Assuming the presidency after Franklin D. Roosevelt's death, Truman served two terms covering the aftermath of World War II and the beginning of the Cold War, including the Korean War, which was widely unpopular and contributed to Truman's low approval rating by the end of his second term in 1953. When asked December 11 to 16, 1952, 56% of poll respondents said they disapproved of his handling of the presidency. Jimmy Carter Approval rating: 34% Carter had high approval ratings — and a disapproval rating in the single digits — during the early days of his term, but his handling of international affairs, such as the Iran hostage crisis in 1979, along with a struggling economy, ultimately made him unpopular by the end of his term. He lost the 1980 election to Ronald Reagan and faced a disapproval rating of 55% in polling conducted December 5 to 8, when he was readying to leave the White House. George W. Bush Approval rating: 34% Despite uniting the nation in the wake of the 9/11 attacks, Bush saw his public approval fade during his second term. His approval rating spiked after the 2001 terrorist attacks, the beginning of the Iraq War in 2003, and the capture of Saddam Hussein. After his reelection, his popularity began to decline as the Iraq War extended. His handling of Hurricane Katrina in 2005 and the onset of the 2008 financial crisis also contributed to his growing unpopularity. From January 9 to 11, 2009, as Bush prepared to hand over the presidency to Barack Obama, 61% of poll respondents said they disapproved of his handling of the presidency. Donald Trump Approval rating: 34% Trump's presidency was divisive from the start, as he entered the White House with an approval rating below 50%. He's the first president in modern history to never exceed 50% approval on the Gallup polls during his presidency. While his approval ratings dwindled over the course of his four years in office, his handling of the COVID-19 pandemic in particular came under scrutiny ahead of his loss in the 2020 election. His lowest approval ratings in office came during the final Gallup poll, conducted January 4 to 15, 2021. Most of that polling period took place immediately after the Capitol insurrection on January 6, and Trump faced a disapproval rating of 62%, the worst after Richard Nixon's at the time he left the office. Joe Biden Approval rating: 40% While Biden saw continuous approval ratings over 50% during his first six months in office, rises in inflation and illegal immigration, as well as the wars in Ukraine and Gaza, contributed to lowering approval ratings. His lowest-ranking Gallup poll, in which 36% of respondents said they approved of his handling of the role, came in July 2024, a month after his debate performance against Trump shifted focus toward his age and fitness for office. As he left office, in polls collected January 2 to 16, 2025, Biden received a disapproval rating of 54%. Lyndon B. Johnson Approval rating: 49% After assuming the presidency because of John F. Kennedy's assassination, Johnson won the 1964 election in a historic landslide, but he faced decreasing approval ratings over his handling of the Vietnam War. Low approval ratings, along with a divided party, led Johnson to withdraw from the presidential race in 1968. At the time of his withdrawal, 36% of poll respondents said they approved of his handling of the presidency. By the time he left the office, however, his ratings had gone up to 49% approval. In polling conducted January 1 to 6, 1969, 37% of respondents said they disapproved of his handling of the role, and 14% said they had no opinion, one of the higher percentages among the listed presidents. Gerald Ford Approval rating: 53% Assuming the presidency at the time of Nixon's resignation, Ford served as US president from August 1974 until January 1977, after he lost the election to Jimmy Carter. During his presidency, Ford faced mixed reviews, with his approval dropping after he pardoned Nixon and introduced conditional amnesty for draft dodgers in September 1974. Polled December 10 to 13, 1976, after he had lost the reelection to Jimmy Carter, 32% of respondents said they disapproved of Ford's handling of the presidency, and 15% said they had no opinion on it, the highest percentage of the listed presidents. George H. W. Bush Approval rating: 56% Though the elder Bush lost his reelection bid in the 1992 presidential election against Bill Clinton, the public opinion of him was positive by the end of his term. In the weeks before his nomination as the Republican candidate for the presidency in 1992, however, he had only a 29% approval rating, the lowest of his presidency. A recession and a reversal of his tax policy contributed to his drop in popularity. In polling conducted January 8 to 11, 1993, 37% of respondents said they disapproved of his handling of the presidency, while 56% said they approved. Barack Obama Approval rating: 59% Since the beginning of his presidency in 2009, Obama had a high approval rating for a modern-day president; he averaged nearly 47% approval over eight years. At his lowest point, in polling conducted September 8 to 11, 2011, 37% of poll respondents said they approved of his presidency, the decline most likely influenced by the president's healthcare policies and his handling of the 2008 economic crisis and the following rise in unemployment rates. In polls conducted January 17 to 19, 2017, when Obama was leaving office, 37% of respondents said they disapproved of his handling of the role, with 59% saying they approved. Dwight D. Eisenhower Approval rating: 59% After winning the 1952 election in a landslide, Eisenhower saw high approval ratings throughout his presidency, never dropping below the disapproval rating. Holding office during critical Cold War years, Eisenhower saw his stay positive throughout the end of his second term, with only 28% of respondents polled December 8 to 13, 1960, saying they disapproved of his handling of the presidency, the lowest of the presidents listed. Ronald Reagan Approval rating: 63% Reagan's strong leadership toward ending the Cold War and implementing his economic policies contributed to consistently positive ratings during his presidency and the subsequent election of his vice president, George H. W. Bush, as his successor to the presidency. By the time he left office, 29% of respondents in a Gallup poll conducted December 27 to 29, 1988, said they disapproved of his handling of the presidency. Bill Clinton Approval rating: 66% After winning the 1992 elections against the incumbent George H. W. Bush, Clinton saw high approval ratings throughout his presidency, though he faced mixed opinions at times during his first term because of his domestic agenda, including tax policy and social issues. Despite being impeached in 1998 by the House of Representatives over his testimony describing the nature of his relationship with Monica Lewinsky, Clinton continued to see positive approval ratings during his second term. Near the time he left the White House, he had an approval rating of 66%, the highest of all the presidents on this list. In the poll conducted January 10 to 14, 2001, 29% of respondents said they disapproved of his handling of the presidency. Read the original article on Business Insider
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32 minutes ago
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Rep. Sarah McBride Details Unique Bond with AOC Over the ‘Spotlight' They've Both Faced in Congress (Exclusive)
Rep. Sarah McBride tells PEOPLE that AOC is "a friend and someone who I have turned to for advice" during her first term in the House In a powerful conversation with AOC featured in the State of Firsts documentary about her run for Congress, McBride discusses the pressures she faces as the first openly trans congresswoman State of Firsts premieres June 7 at the Tribeca Festival and screens through June11Rep. Sarah McBride has a strong ally in Congress in one of the House's most visible figures: Rep. Alexandria Ocasio-Cortez. McBride, 34, tells PEOPLE that AOC, 35, has been a source of support since she began her first term in Congress in January. McBride, who made history when she became the first openly transgender person to be elected to the House in November 2024, is the subject of the new State of Firsts documentary from director Chase Joynt, which follows her campaign for Congress. In one scene from the documentary filmed after she won her seat as a U.S. representative from Delaware, McBride and AOC sit down in her office for a chat about "firsts." While speaking to PEOPLE ahead of State of First's Saturday June 7 premiere at the Tribeca Festival, McBride detailed her important bond with the lawmaker. "She's definitely become a friend and someone who I have turned to for advice. She entered Congress with a profile that exceeds mine with a lot of attention," McBride says. "And you know, it wasn't always easy for her." AOC made history in 2018 as the youngest women ever elected to Congress and currently represents New York's 14th congressional district. But in her first term, she said she faced backlash for her outfits and was treated like an intern. McBride says AOC's struggles in her first term have strengthened their connection. "I have often gone to her as one of the few people who knows what it's like coming in as a new member, as a freshman and having a spotlight on you that exceeds what most freshmen have," McBride says, noting, "The challenge of navigating a new place, a new workplace with that spotlight, with those attacks, there are very few people who have that experience." During the meeting between the two congresswomen featured in State of Firsts, the Delaware lawmaker tells AOC she's "struggling with protecting my voice and my ability to be seen and heard authentically for who I am and what I am here to focus on, and the inevitable pool that others are trying to pull me in." Ocasio-Cortez nods as she replies, "What people don't see and what they don't really experience is that being the first means being the only." She continues, "The immense amount of expectation placed on anyone who's a first, in my experience, that is not something that goes away." She then becomes heated over critics who have attacked McBride for her gender identity, telling her, "What they go after is your essential dignity as a human being. And, to be frank, that's what really pisses me off about this." "I want to respect your autonomy and I want to respect your story and how you want to handle this for yourself, but I also want to clock these motherf------," she exclaims. Never miss a story — sign up for to stay up-to-date on the best of what PEOPLE has to offer, from celebrity news to compelling human interest stories. In a moment also included in State of Firsts, AOC hits back after the House bans trans people from using the Capitol's single-sex bathrooms that match their gender identity, calling the proposal "disgusting" in an interview that first aired on Spectrum News. "All it does is allow these Republicans to go around and bully any woman who isn't wearing a skirt because they think she might not look woman enough,' she says in the interview. While speaking with PEOPLE, McBride says AOC is someone she has "come to rely on for advice," adding, "She certainly has become a friend and I really deeply respect her." State of Firsts premieres at Tribeca Festival on June 7. Read the original article on People
