The omnibus spending bill signed by President Trump will ultimately raise spending by around $500 billion over the next decade when economic growth and interest costs are factored in, according to a new analysis Tuesday.
The Penn Wharton Budget Model, a private-sector model of federal spending and taxing, analyzed the spending bill, which provided for $1.3 trillion in appropriations for fiscal year 2018, and found that it would add 1.6 percent to the federal debt over the next 10 years. The calculation is a “dynamic analysis,” meaning that it tries to account for the bill’s effect on the economy as well as on direct government spending.
In the model, the added federal debt from the bill “slightly dampens economic growth,” according to the budget experts. The slower economic growth, in turn, means lower tax revenues and higher spending on interest on the debt.
Altogether, the spending measure is expected to add $500 billion in spending over the next 10 years, even though the legislation only called for roughly $300 billion in new spending on paper.
Trump signed the bill on Friday, saying that he would have preferred to have the government spend less but that Democrats negotiated for higher spending on domestic programs in order to meet his demand for greater military spending.
“We’re very disappointed that in order to fund the military, we had to give up things where we consider, in many cases, them to be bad or them to be a waste of money,” he said. “But that’s the way, unfortunately, right now the system works.”
