Bolton Calls National Debt ‘Economic Threat’ to US

November 1, 2018

By Toluse Olorunnipa

WASHINGTON — U.S. national security adviser John Bolton called the national debt a “threat to the society” that requires significant cuts to the government’s discretionary spending.

Bolton, speaking Wednesday at an event hosted by the Alexander Hamilton Society in Washington, said he expects U.S. defense spending “to flatten out” in the near term. He said he didn’t anticipate major cuts to entitlements such as Medicare and Social Security.

“It is a fact that when your national debt gets to the level ours is, that it constitutes an economic threat to the society,” Bolton said. “And that kind of threat ultimately has a national security consequence for it.”

Discretionary spending is set by Congress each year, while spending on entitlements is twice as large and more automatic, generally dictated by demand for the services. Many budget experts say entitlement spending presents a larger long-term threat to the U.S. economy because of both its magnitude and increasing demand from an aging population.

“In the near term, the budget deficit problem is in the discretionary spending,” Bolton said. “The entitlements come in a few years and that problem’s going to have to be addressed. But right now, you can have significant impact on both the deficit and the national debt by cutting government spending on the discretionary programs.”

In President Donald Trump’s first full fiscal year, the U.S. budget deficit grew to $779 billion, the highest level since 2012, despite an economy that Trump budget director Mick Mulvaney last week called a “Goldilocks moment” combining low unemployment and contained price growth. The deficit growth has been fueled in part by tax cuts and higher government spending since Trump took office, according to the Congressional Budget Office.

The nonpartisan Congressional Budget Office forecasts the budget gap will reach $973 billion in fiscal 2019 and exceed $1 trillion the next year. Goldman Sachs Group Inc. predicts the deficit will reach $1 trillion and $1.125 trillion respectively.

———

Saleha Mohsin and Erik Wasson contributed to this report.

———

©2018 Bloomberg News

Visit Bloomberg News at www.bloomberg.com

Distributed by Tribune Content Agency, LLC.

Economy

Federal Reserve, Meeting This Week, Expected to Act With A Steady Hand Economy
Federal Reserve, Meeting This Week, Expected to Act With A Steady Hand
March 19, 2019
by Dan McCue

Steady as she goes. That was the widely held expectation as the Federal Open Market Committee, the policy-making arm of the Federal Reserve, gathered Tuesday morning to kick off its two-day meeting this week. Given statements made by Fed Chairman Jerome Powell in several recent interviews,... Read More

US Industrial Production Rose a Sluggish 0.1 Percent in February Economy
US Industrial Production Rose a Sluggish 0.1 Percent in February
March 15, 2019
by Dan McCue

U.S Industrial production rose just 0.1 percent in February, slowed by the second straight monthly decline in manufacturing activity, the Federal Reserve said Friday. The central bank said manufacturing production dropped 0.4 percent last month, held down by declines in the output of motor vehicles, machinery,... Read More

Consumer Prices Rose Slightly In February, But Inflation Remains Tame Economy
Consumer Prices Rose Slightly In February, But Inflation Remains Tame
March 12, 2019
by Dan McCue

Consumer prices rose a slight 0.2 percent in February, the first increase in four months, but inflation remains tame, the Labor Department said Tuesday. The latest consumer price index, which measures what Americans pay for a wide range of products, attributed the rise to higher gasoline... Read More

Kudlow Brushes Off Calls for Economic Slowdown, Says 3% Growth Can Continue Economy
Kudlow Brushes Off Calls for Economic Slowdown, Says 3% Growth Can Continue

WASHINGTON ––President Donald Trump’s chief economic adviser said Sunday that U.S. economic growth can continue at 3 percent in 2019 and beyond, even as many private economists look for a slowdown this year as the effects of the 2017 Republican tax cuts wears off. Larry Kudlow,... Read More

US Employers Slam Brakes On Hiring, Add Just 20,000 Jobs in February Economy
US Employers Slam Brakes On Hiring, Add Just 20,000 Jobs in February
March 8, 2019
by Dan McCue

US employers added just 20,000 jobs in February, a sharp pullback after a quarter of solid gains averaging 186,000 new jobs a month, the Labor Department reported Friday. The scarcity of new jobs added to the economy is the smallest monthly gain in nearly 18 months,... Read More

US Household Net Worth Plunged a Record $3.8 Trillion During Fourth-Quarter Stock Tumult Economy
US Household Net Worth Plunged a Record $3.8 Trillion During Fourth-Quarter Stock Tumult
March 7, 2019
by Dan McCue

The net worth of America's households fell by a record $3.8 trillion at the end of 2018, pulled down by sharp declines on Wall Street that briefly pushed the market into bear territory, the Federal Reserve said Thursday. The bracing news, part of the Federal Reserve's... Read More

Straight From The Well
scroll top