Elon Musk has proposed budget cuts of up to $1 trillion to address the US’s growing deficit, which has reached over $2 trillion. The billionaire SpaceX CEO made his remarks during a press conference with President Donald Trump in the Oval Office.
Trump and Musk plan to make significant reductions in federal spending across various departments, aiming to save taxpayers money and reduce bureaucracy. They believe this move will help prevent the country from going bankrupt due to its massive deficit.
The US government has not seen a surplus between spending and revenue since 2001. The new Trump administration is prioritizing responsible government accounting, with balancing the books being a key goal.
Musk’s plan involves cutting federal spending, which he initially proposed at $2 trillion but later revised to $1 trillion. This aim was met with skepticism by some economists, who questioned whether it was feasible.
The Bipartisan Policy Center noted that interest payments on national debt significantly impact ongoing deficits. Musk’s proposal aims to narrow the deficit by reducing federal spending and allowing the government to service its debt.
However, experts have doubts about the feasibility of Musk’s plan, particularly with Trump’s pledge to lower taxes, which could exacerbate the deficit problem. The Congressional Budget Office projects that the deficit will rise to $1.9 trillion this year.
President Joe Biden previously reduced the national debt inherited from the Trump administration but did not mention its pre-pandemic levels. Trump’s impact on the debt and deficit was significant, with near-historic levels reached before the pandemic in 2019.
The US Treasury reports that in the fiscal year to date, the deficit is $711 billion, with interest payments exceeding Defense Department outlays.
Source: https://www.newsweek.com/does-us-have-2-trillion-deficit-2030093