Extending Bush Tax Cuts & US National Debt

HopeTracker| Pew Research has quantified the further increase in America’s national debt if the 2001-2—3 Bush Administration tax cuts are renewed. Their report Decision Time: The Fiscal Effects of Extending the 2001 and 2003 Tax Cuts advises:

The current debt-to-gross domestic product (GDP) ratio in the United States is 57 percent, compared to an average of 37 percent over the last 50 years. Making the tax cuts permanent for all taxpayers would cost $3.1 trillion, including interest on the national debt, over ten years and cause the national debt-to-GDP ratio to rise to 82 percent.

If the cuts are only extended to individuals earning less than $200,000 and married couples less than $250,000, the ten-year cost of the cuts would be $2.3 trillion (including debt interest) and the debt-to-GDP ratio would increase to 78 percent. Both of these ratios would be the highest since 1950, when the United States was still paying off debts incurred during World War II.