Breaking News Emails
A trillion here, a trillion there, and pretty soon you're talking about a real "Bern" for American's debt — and possibly the overall economy.
Presidential contender Bernie Sanders' broadly progressive tax and spending proposals would add a whopping $21 trillion to the national debt over the next decade, according to a joint analysis released Monday.
That amount far exceeds the $14 trillion in debt currently owed by the federal government.
The massive additional debt represents the net bill for the Vermont senator's proposals to implement a single-payer health-care system, provide generous long-term care services, provide free public college tuition and paid family leave, and expand Social Security.
Sanders' proposals would cost $33.3 trillion in new spending, mostly from his health-care proposals — more than double the $15.3 trillion in new taxes, mostly on wealthier American households, that he proposes if he's elected president, according to the analysis by the Tax Policy Center.
That difference adds $18 trillion to the federal budget deficit over the course of 10 years, according to the center, a joint venture of the Urban Institute and the Brookings Institution. That amount is equivalent to about 7.5 percent of gross domestic product.
On top of that, the government would be on the hook for $3 trillion in additional interest payments to finance that extra spending, the analysis found.
The addition of such large levels, if it was not otherwise funded by additional revenue, could set off a "spiral," in which the debt causes interest rates to rise, which would in turn increase the deficit as the borrowing costs for the government then rose, said Len Burman, director of the Tax Policy Center.
That, Burman said, could in turn cause investors to think that government debt was not a good investment, which could further increase the costs of borrowing for the federal government.
If Sanders' proposed new spending measures were not funded beyond the level he currently proposes, Burman said, "That could be very damaging to the economy."
The Sanders campaign had blasted an earlier report from the Tax Policy Center that looked at just the tax impact of Sanders' proposal, saying it failed to take into account the fact that many American households would see their take-home pay go up under the health-care proposal, and that at least 13 million jobs would be created by infrastructure repair efforts.
The campaign in a statement to CNBC likewise took issue with the new analysis, saying the authors "get it half right," with the "good news" being an acknowledgement that low- and middle-income households would end up saving thousands of dollars per year under the proposals.
But Sanders campaign policy director Warren Gunnels said the analysis "wildly overestimates the cost of Senator Sanders' health care plan" by falsely assuming state and local governments "will dump all of their health care obligations onto the federal government at a cost of $4.1 trillion over the next decade." Gunnels said Sanders would require those governments to maintain their current health-care spending levels.
Gunnels also said the study "significantly underestimates" savings from reduction in medical paperwork, administration and prescription drug prices that would result from the plan.
Sanders, a self-described socialist who caucuses with the Democrats in the Senate, trails Hillary Clinton for the Democratic presidential nomination, but has vowed to continue his campaign into the summer.
Sanders has drawn wide support for his calls to tax the rich more aggressively in order to finance a wide expansion of social services.
Although Sanders' proposed $15.3 trillion in new taxes would "increase the tax burdens for households at all income levels ... the increase would be much larger both in absolute dollars and as a share of after-tax income for the highest-income households," the analysis said.
And all income groups, other than those in the top 5 percent of households, would receive higher net transfers — meaning they would benefit more financially from the proposals, the analysis said.
But the new spending that what Sanders wants would eat up that $15.3 trillion in new revenue, and then some, the analysis found.
The single-payer health-care system that Sanders wants would cost the government more than $29 trillion over 10 years, the research found. New spending on long-term care would cost $2.9 trillion during that time, according to the analysis.
Tuition-free college would cost $807 billion, while family medical leave spending would cost $270 billion over the decade. Expanding Social Security benefits would cost another $188 billion over 10 years, the analysis found.