WASHINGTON (UPI) — Democratic presidential candidate Bernie Sanders’ proposed social programs would raise the federal deficit by $18 trillion over the next decade, according to a study by the Tax Policy Center.
The 10-year increase could “retard economic growth,” the research group in Washington, D.C., concluded in reports issued Monday.
The increases are the equivalent to a year’s output for the entire U.S. economy.
Sanders, who is trailing former Secretary of State Hillary Clinton in delegates for the Democratic nomination, has proposed universal healthcare, expanded Social Security and free college tuition at public schools.
Sanders says the programs can be paid for with an increase in revenues of $15.3 trillion over the next decade. But federal outlays would amount to $33.3 trillion over that decade. This would lead to annual deficits of $1.8 trillion that would raise interest payments on the national debt.
“It could be very damaging to the economy,” said John Holahan, a fellow at the Urban Institute’s Health Policy Center and the lead author of one of the two reports.
Warren Gunnels, who is Sanders’ campaign’s policy director, said in an emailed statement that the study “wildly overestimates the cost of Senator Sanders’ healthcare plan.”
The report says national health expenditures would increase by a total of $518.9 billion (16.9 percent) in 2017, and by $6.6 trillion (16.6 percent) between 2017 and 2026.
Gunnels said it was “categorically false” the authors assumed that state and local governments would push their healthcare spending onto the federal government.
Also, he said, the report doesn’t address $500 billion in annual savings by reducing healthcare-related bureaucracy and lowering prescription drug prices.
Sanders has said his healthcare plan would cost about $1.38 trillion — half the reports’ projections.
The report found the tax increases would hurt all economic levels. It noted the bottom 95 percent of the households would receive more in benefits than they paid but the top 5 percent would see an average tax increase exceeding benefits by about $111,000.
State and local governments could save $319.8 billion in 2017 and $4.1 trillion between 2017 and 2026 as the federal government absorbs health costs under the Sanders plan.
Sanders estimates that his college plan would cost about $75 billion annually. Funding would include a tax on Wall Street trading and from states.
The Tax Policy Center is a joint venture of the Urban Institute and the Brookings Institution.
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