Chairman Yarmuth Opening Statement at Budget Hearing on CBO Baseline and Economic Forecast
Washington, D.C.— Kentucky Congressman John Yarmuth, Chairman of the House Budget Committee, gave the following opening statement at today’s hearing on the Congressional Budget Office’s (CBO’s) updated budget and economic outlook. Remarks as prepared are below:
Good morning. I would like to give a special welcome to Dr. Phillip Swagel, who is testifying before our committee for the first-time as Director of the Congressional Budget Office. I would also like to take a moment to thank Director Swagel and all of the dedicated staff at CBO, for their hard work and their commitment to being a non-partisan, indispensable partner to Congress.
In 2019 alone, CBO worked diligently to publish over 700 cost estimates and nearly 80 analytic reports, working papers, and testimonies. While the compendium of CBO’s work is invaluable to our work here in Congress, our annual hearing on the Budget and Economic Outlook is always enlightening as we begin a new session of Congress.
Yesterday, CBO released its report, unveiling its projections for the next decade. Unfortunately, the report once again confirms that, despite the economic expansion he inherited, the fiscal outlook has worsened since President Trump took office.
Director Swagel, you project a deficit this year that is over $1 trillion. And over the next decade, deficits are projected to rise. The national debt is expected to reach 98 percent of GDP by 2030, the highest ratio since World War Two.
This report once again confirms that despite the economic expansion he inherited, the fiscal outlook has worsened since President Trump took office.
Under President Trump, deficits have risen to heights not usually seen outside of recessions and major world wars. They have increased every year – an unusual trend given that deficits tend to fall with the unemployment rate. In fact, the deficit in 2019 was the highest since 2012, when we were recovering from the Great Recession and the unemployment rate was 8 percent – more than double the rate today. As a result of these deficits, the national debt has climbed higher and faster than CBO projected at the end of the Obama Administration.
Now, on their face, these fiscal facts might not be so concerning if we were using the fiscal space we have to make critical investments while interest rates are low to address the multitude of deficits we face in the real economy. Crumbling infrastructure. Skyrocketing health care costs. Widening student achievement gaps. A warming climate. Lower life expectancy. In light of these and other problems, it’s difficult to escape the conclusion that we should be making bolder investments in American families and our nation’s future.
But unfortunately, that’s not the reality. The reality is that President Trump and Republicans drove up deficits to instead gift the wealthy and corporations with a $1.9 trillion tax cut. $1.9 trillion that had little meaningful impact on the economy. $1.9 trillion that could have been, but was not, put toward making childcare more affordable, a college education more accessible, and retirement security more achievable for American families.
Our economy and budget face difficult times ahead. An aging population and rising health care costs mean economic growth is projected to be slower and deficits are expected to be larger going forward. As we learned from our previous hearings, a warming climate will increasingly stress our nation’s budget. Meanwhile, we will need to make investments in our infrastructure, education, and job training if we hope to complete in the global economy. CBO’s report shows that there is a real need to address our fiscal issues over the next several decades and the solution will require a balanced approach and a fair tax system.
As Chairman of the Budget Committee, I have stressed that we need to think seriously about severe and persistent deficits in the real economy, not just deficits in the budget. That doesn’t mean that we can spend taxpayer dollars without thought or discretion. But it does require that we use our nation’s resources more wisely than this Administration has. It means prioritizing policies that will help modernize our economy, prepare our communities for the opportunities of the future, and help more American families get ahead in this economy.
Director Swagel, thank you for helping us begin that conversation. I look forward to hearing your testimony.