The University of Pennsylvania’s Wharton School, President Trump’s alma mater, has released an analysis of the Republican tax plan that concludes it would add nearly $2 trillion to the national debt even with the economic growth projected by Republicans, despite their repeated claims that the bill will pay for itself.
The analysis by the Penn Wharton Budget Model finds that “even with assumptions favorable to economic growth,” the Senate’s version of that tax bill would add more than $1.5 trillion to the nation’s debt over the next decade.
The Wharton model estimates that the plan could add $1.8 trillion to $1.9 trillion in debt even with economic growth.
“By 2027, under our standard economics assumptions, [gross domestic product] is projected to be between 0.5 percent and 1.0 percent larger, relative to no tax changes. Debt increases between $1.8 trillion and $1.9 trillion, inclusive of economic growth,” Wharton’s analysis reads.
“Penn Wharton Budget Model’s dynamic analysis projects that The Senate Tax Cuts and Jobs Act increases federal debt in both the short- and long-run relative to current policy. In the near term, there is a small boost to GDP, but that increase diminishes over time,” the study’s conclusion reads.
On Monday, the Trump administration doubled down on its claim that the tax plan would pay for itself under positive economic growth, releasing a one-page memo touting the claim.
“The Administration has been focused on tax reform and broader economic policies to stimulate growth, which will generate significant long-term revenue for the government,” Treasury Secretary Steven Mnuchin said in a statement.