Republican Senate & Democratic House will fuel spending, deficit, debt

The House under Democratic control and the Senate with a larger Republican majority means that an already a difficult federal budget situation will be even more difficult in the next Congress. Add in a Trump White House in reelection mode, and the federal budget outlook is clearly much worse.

There are five reasons.

First, if there are no changes and federal spending and revenues are left on autopilot because there’s a stalemate among the House, Senate and White House, the budget deficit will balloon to more than $1 trillion a year … and stay there. According to the Congressional Budget Office, the deficit will be at or well above that level for every year through at least 2028.

Budget agreements might increase deficit

Second, to the extent there are any budget-related agreements between House Democrats and Senate Republicans over the next two years, they are likely to be on things that will increase the deficit even further. The new Republican Senate and Democratic House will each demand that their spending preferences be accommodated before they will agree to support what the other wants. The result could either be that nothing gets added to the already soaring deficit outlook, or they pile on billions more.