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NEW YORK (CNNMoney) — Newt Gingrich’s economic plan would do a lot of things. But reducing the debt and balancing the federal budget aren’t among them.
Same goes for Rick Santorum’s and Mitt Romney’s economic plans.
Indeed, a preliminary analysis by the independent Committee for a Responsible Federal Budget released Thursday estimates that the three candidates’ plans could add between $250 billion and $7 trillion of debt over the next nine years.
By contrast, the proposals of Ron Paul could reduce the debt by $2.2 trillion, the group estimated.
Romney vs. Gingrich on the economy
The estimated changes in debt were made relative to what the CRFB calls a realistic baseline, in which the Bush-era tax cuts are made permanent, scheduled payment cuts to Medicare doctors are prevented and $1.2 trillion in automatic spending cuts are waived.
Under that scenario, debt held by the public will rise to 85% of GDP by 2021, up from about 70% today. Both are well above the country’s historical average of 40%.
Debt over next decade: Adds $7 trillion, increasing debt to GDP to 114%.
Costliest proposal: Create an alternative flat tax of 15%, which would increase debt by $3.4 trillion.
Biggest cost saver: Turn means-tested federal programs such as Medicaid into block grants to states and cut federal funding for these programs in half, saving $2.4 trillion.
Interest costs on the debt: Raises it by $900 billion.
The Gingrich campaign, in a statement, essentially dismissed the CRFB analysis “because they show no comprehension of how to score the impact of economic growth in helping to balance the budget.”
The campaign maintains that his plan would create 6.6 million jobs in the first two years and balance the budget in his first term.
Debt over next decade: Adds $4.5 trillion, increasing debt to GDP to 104%.
Costliest proposal: Reduce and reform individual income taxes, at a cost of $3.6 trillion.
Biggest cost saver: Transform various social programs into block grants to states and capping their growth, saving $950 billion.
Interest costs on the debt: Raises it by $640 billion.
Debt over next decade: Adds $250 billion, increasing debt to GDP to 86%.
Costliest proposal: Reduce corporate taxes, which would increase debt by $1 trillion.
Biggest cost saver: Reduce federal workforce costs, saving $530 billion.
Interest costs on the debt: Raises it by $40 billion.
The CRFB said it will update its analysis to include the revised tax planthat Romney released on Wednesday. He said he wanted to cut marginal tax rates for individuals by 20%, among other things.
While Romney said his tax plan would not add to the deficit, he didn’t offer specifics as to how he’d pay for his newly proposed tax cuts. Absent those offsets, the CRFB roughly estimates that his plan could add $2.6 trillion in debt, boosting debt to 96% of GDP by 2021.
Debt over next decade: Reduces it by $2.2 trillion, lowering debt to GDP to 76%.
Costliest proposal: Get rid of various income taxes, such as the Alternative Minimum Tax and taxes on investment income, Social Security benefits and tips, at a cost of $2.5 trillion.
Biggest cost saver: Reduce many parts of non-defense spending, such as eliminating five federal departments including education, commerce and energy, saving $4.5 trillion.
Interest costs on the debt: Lowers it by $300 billion.
Tags:Alternative Minimum Tax, campaign, CRFB, Debt, economic, first, GDP, GOP, Mitt Romney, Newt Gingrich, proposals, rates, Rick Santorum, Ron Paul, Social Security, taxes, Wednesday
