Erik Wasson and Enda Curran | (TNS) Bloomberg News

WASHINGTON — Republican nominee Donald Trump and running mate JD Vance are campaigning on a grab bag of tax cut proposals that could collectively cost as much as $10.5 trillion over a decade, a massive sum that would exceed the combined budgets of every domestic federal agency.

Even if Congress were to eliminate every dollar of nondefense discretionary spending — projected to be $9.8 trillion over the next 10 years — it still wouldn’t offset the estimated expense of the wide-ranging tax cuts Trump and Vance have floated in recent weeks.

The price tag is based on rough, initial estimates from tax and budget specialists because the Trump campaign hasn’t released detailed policy plans for its tax promises.

The Trump campaign said in a statement the former president will cut wasteful spending and increase energy production to pay for the tax cuts and lower the national debt. The campaign didn’t offer more detail.

Though Democrat Kamala Harris also has proposed a few large tax cuts — she would exempt tips from taxation and expand the child tax credit — the impact on the nation’s finances pales in comparison. She calls for offsetting the lost income, which one think tank estimates at roughly $2 trillion, with tax increases on corporations and wealthy individuals.

Harris is continuing to roll out policy ideas piecemeal, which could add to that total. On Tuesday, she called for an expanded deduction for start-up businesses and her campaign has signaled that more policy plans could be released in the coming weeks. On Wednesday, she proposed increasing the capital gains tax rate to 28% from 20%, which would raise federal revenue.

The sheer magnitude of the Trump campaign’s tax promises make it highly unlikely they all would pass even in a Congress controlled by Trump allies. The Republican ticket’s tax proposals include extending Trump’s 2017 tax cuts, a big expansion to the child tax credit and exemptions for tips and Social Security payments.

“Congress is not going to pass a $10 trillion deficit-financed tax cut,” said Kyle Pomerleau, a senior fellow with the right-leaning American Enterprise Institute.

Republicans have long argued that tax cuts boost growth. But it’s not clear how much Trump’s proposals, which largely cut levies for individuals rather than businesses, would spur new economic activity.

The combined cost of the Trump plans is so big that if Congress were to try to pass the tax cut proposals and keep spending flat, it means they could continue to fund the military, federal benefit programs, like Social Security, pay interest on the debt — and nothing else. That means eliminating major federal agencies that handle duties such as law enforcement, border security, air traffic control, tax collection and international relations.

Trump’s supporters are accustomed to his impromptu, broad-stroke policy pronouncements, while some key Democratic constituency groups demand detailed policy proposals from their candidates and a firm plan offsetting the cost.

Harris and President Joe Biden released a detailed budget proposal this year to cut federal deficits $3 trillion over a decade, by raising taxes on corporations and wealthy individuals and other measures. Those plans mirror some of the offsets Harris has proposed but previously have run into powerful opposition from major business lobbies.

Without those compensating tax increases, the Harris proposals could increase the deficit by as much as $2 trillion over the next decade, according to the University of Pennsylvania Penn Wharton Budget Model.

Tax Agenda

For both candidates, much will hinge on how well their party does in congressional elections, said Wendy Edelberg, a former Federal Reserve and Congressional Budget Office economist who’s now director of the Brookings Institution’s Hamilton Project.

The outlook “depends on a million different factors, particularly the balance of power in Congress,” Edelberg said. “Perhaps no policy will get enacted as specifically proposed by either candidate.”

Taxes will be a top agenda item in Congress next year, regardless of who wins the White House or which party controls the House and Senate. Major portions of Trump’s 2017 tax cuts — including lower individual rates and deduction for small businesses — expire at the end of 2025, which will force Congress to address the tax code next year.

Trump has made extending his signature tax law the centerpiece of his agenda. The Congressional Budget Office says that would cost $4.6 trillion over 10 years. He’s also floated lowering the corporate rate to 15% from 21%, adding another $874 billion to the total, according to a budget model by the Committee for a Responsible Federal Budget.

On the campaign trail, the Republican ticket has verbally floated more tax ideas with hefty price tags: excluding Social Security payments from taxes ($1.8 trillion), exempting taxes on tipped wages ($250 billion) and increasing the $2,000 child tax credit per child to $5,000 ($3 trillion).

Added all up, that’s $10.5 trillion. If Congress were to seriously consider these ideas, official federal scorekeepers would model out the effects, including how the tax cuts interact with one another.

Revenue Raisers

Trump has offered very few options to raise more federal revenue. He has vowed to block any cuts to Medicare and Social Security benefits and has called for an increase in military spending. He’s proposed universal tariffs ranging from 10% to 20%. The left-leaning Urban-Brookings Tax Policy Center has estimated a 10% across-the-board levy could raise $2.8 trillion over 10 years.

That has the potential to cover some of the cost of his tax cuts, but doesn’t take into account what economists warn are large negative economic growth effects or the cost of compensating farmers for trade retaliation from other countries.

The rising national debt is already stoking concern among investors and ratings agencies.

Federal Reserve Chair Jerome Powell has warned that higher government budget deficits are on an unsustainable path. In November, Moody’s Investors Service signaled it could downgrade the U.S. from the highest investment grade, Aaa.

CBO projects federal debt held by the public will exceed 100% of the GDP next year and rise to 122% in 10 years without any new tax cuts.

“The fiscally responsible thing for either candidate to do, if they are proposing tax cuts, is to tell us how they are going to pay for them,” said Keith Hall of George Mason University, who once led the nonpartisan CBO.

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By ERIC TUCKER, ALANNA DURKIN RICHER and MICHAEL KUNZELMAN Associated Press

WASHINGTON (AP) — In the first court hearing in nearly a year, a lawyer for Donald Trump clashed on Thursday with the judge in the federal election interference prosecution of the former president after suggesting the government was rushing forward with an “illegitimate” indictment at the height of the White House campaign.

Prosecutors and defense lawyers are bitterly at odds over the next steps in the case after the Supreme Court narrowed the scope of the prosecution by ruling that former presidents are entitled to broad immunity from criminal charges. The dueling proposals and testy courtroom exchanges reflected the extent to which the justices’ July opinion had upended the path of the case that charges Trump with plotting to overturn the results of the 2020 election in the run-up to the Capitol riot on Jan. 6, 2021.

“We may be dealing with an illegitimate indictment from the get-go,” Trump attorney John Lauro said. He added: “We want an orderly process that does justice to the Supreme Court opinion.”

Special counsel Jack Smith’s team filed a revised indictment last week to strip out certain allegations against Trump for which the Supreme Court said Trump, the Republican nominee for president, enjoyed immunity. Defense lawyers, however, believe that that indictment did not fully comply with the justices’ ruling.

Lauro told U.S. District Judge Tanya Chutkan that the Supreme Court’s opinion required the outright dismissal of the case, a position the judge made clear she did not accept. He complained that prosecutors were showing a “rush to judgment” with their plans to soon file court papers explaining why the remaining allegations should remain intact.

Chutkan was unmoved on that point as well.

“This case has been pending for over a year,” Chutkan said, referencing the fact that the matter has been frozen since last December while Trump pursued his immunity appeal. “We’re hardly sprinting to the finish here.” She said it was clear that whatever her ruling, it would be subject to a further appeal.

She also bristled at Lauro’s reference to the November election, such as when he said: “This process is inherently unfair, particularly during this sensitive time.”

“I understand that there is an election,” the judge replied. “I’ve said before … that the electoral process and the timing of the election … is not relevant here. The court is not concerned with the electoral schedule.”

Lauro told Chutkan that the case concerned momentous issues. “We are talking about the presidency of the United States,” he said. Chutkan shot back: “I’m not talking about the presidency of the United States. I’m talking about a four count indictment.”

She told Lauro that it appeared the defense was trying to delay the case because of the election. “That’s not going to be a factor I consider at all,” Chutkan said.

Pushing back on the defense’s claims that the special counsel wants to move too quickly, a member of Smith’s prosecution team noted that Trump’s lawyers filed a lengthy brief seeking to overturn his New York hush money conviction and dismiss the case less than two weeks after the Supreme Court’s ruling in July.

“The defense can move comprehensively, quickly and well. So can we,” Thomas Windom said.

The tense exchanges between Lauro and Chutkan defined the early hearings in the case. But there was a lighter start of Thursday’s session.

At the opening, Chutkan noted that it has been almost a year since she saw the lawyers in her courtroom. Lauro joked to the judge that “life was almost meaningless without seeing you.”

“Enjoy it while it lasts,” Chutkan said.

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The hearing ended without the judge issuing an order about future dates in the case.

Trump was not in the courtoom and gave an economic speech in New York. A not guilty plea was entered on his behalf for the revised indictment.

Defense lawyers said they intend to file multiple motions to dismiss the case, including one that piggybacks off a Florida judge’s ruling that said Smith’s appointment was unconstitutional.

Neither side envisions a trial happening before Election Day, especially given the amount of work ahead. Chutkan is tasked with determining which of the acts alleged in the indictment can remain part of the case in light of the Supreme Court opinion.

The justices in July ruled that former presidents enjoy absolute immunity for the exercise of their core constitutional duties and are presumptively immune from prosecution for all other official acts.

Smith’s team responded to the ruling with a revised indictment last week that removed references to Trump’s efforts to use the law enforcement powers of the Justice Department to remain in power, an area of conduct for which the Supreme Court said Trump is immune.

The case is one of two federal prosecutions against Trump. The other, charging him with illegally hoarding classified documents at his Mar-a-Lago estate in Palm Beach, Florida, was dismissed in July by U.S. District Judge Aileen Cannon. She said Smith’s appointment as special counsel was unlawful.

Smith’s team has appealed that ruling. Trump’s lawyers say they intend to ask Chutkan to dismiss the election case on the same grounds.