Trump s will reduce deficits by up to 11 trillion?

Trump Policies Will Cut Deficits Up to $11 Trillion, White House Economist Says
Story by Skylar Woodhouse •


Bloomberg) -- President Donald Trump’s policies will reduce US fiscal deficits by up to $11 trillion over the coming decade, according to the White House’s chief economist — a projection that defies analysts who say government debt is poised to climb to record highs in coming years.

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“We calculate that, overall, the reduction in deficits as a result of the total suite of the president’s policies is going to be roughly $8.5 to $11 trillion over the 10-year budget window,” Stephen Miran, chair of the Council of Economic Advisers, told reporters on a call Wednesday. “Those are very big numbers.”

About half the savings, or $3 trillion to $5 trillion, would come from faster economic growth — thanks to the pending Republican tax cut bill, along with deregulation efforts — Miran argued. He also cited a $3 trillion bump in revenues from Trump’s tariff hikes, referring reporters to the Congressional Budget Office’s recent calculation — which came in at $2.8 trillion. Reduced debt loads thanks in part to those savings will help to bring down the US Treasury’s interest costs by approximately $1 trillion to $1.5 trillion, he said.

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Miran was speaking on a call touting the benefits of the GOP’s “One Big Beautiful Bill” of tax and spending cuts that Trump has called on his party to pass in Congress by July 4. The House passed one draft last month, and the Senate is now aiming to approve its version this week.

The House-passed version of the package was most recently estimated by the CBO to boost the deficit, not cut it, by some $2.8 trillion. The CBO analysis on tariffs also assumed that the tariff rates in effect as of mid-May would be in place for a decade — even though trade talks are under way that may reduce those levies, and Trump won’t be in office throughout that period.

Trade Agreements
A preliminary analysis from the Tax Foundation found the Senate bill would cost $3.9 trillion over a decade, after accounting for economic impacts.

Miran also said that he’s optimistic there will be a flurry of framework agreements with US trading partners getting announced by July 9, the expiration date for Trump’s pause on reciprocal tariffs. Agreements will depend on the willingness of other countries to engage, Miran said, adding that he expects there to be “some stubborn holdouts.” Any agreements notwithstanding, Miran said there’s no downside risk to the CBO’s $2.8 trillion estimate for increased revenue from tariffs.

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The CEA offered a breakdown of its analysis showing the impact of Trump’s policies, which included the following estimates:

Faster growth thanks to the tax cuts will shrink fiscal deficits by $2.1 trillion to $2.3 trillion over a decade.Stronger growth due to deregulation and Trump’s energy policies will narrow the deficit by another $1.3 trillion to $3.7 trillion.The US debt-to-gross domestic product ratio will fall to 94% by 2034, instead of rising to 117% if Trump’s 2017 tax cuts were allowed to expire at year-end.

Analysis by the non-partisan CBO in January that incorporated an expectation for the expiration of the 2017 tax reductions showed the US on course for a 107% debt-to-GDP ratio by 2029 — exceeding the all-time high reached in 1946, just after the end of World War II.

For his part, Treasury Secretary Scott Bessent earlier this month said there’s “varying scoring” of the tax bill, telling lawmakers, “It is my view that over the 10-year window, it will decrease.”

Federal budget deficits have exceeded 6% of GDP the past two years, despite strong economic growth and job gains. Bessent said this month that the 2025 gap would come in between 6.5% and 6.7%.

When it downgraded the US sovereign rating last month, Moody’s Ratings said it expected deficits to widen, reaching nearly 9% of GDP by 2035, “driven mainly by increased interest payments on debt, rising entitlement spending, and relatively low revenue generation.”