White House says $2 trillion budget "accounting error" was made on purpose

After a former US treasury secretary found something strange in Trump's figures...

White House says $2 trillion budget "accounting error" was made on purpose

Picture by: Niall Carson/PA Wire/PA Images

The Trump administration has doubled down on the apparent double counting recently revealed in the US President's first budget, admitting it was playing free and easy with $2 trillion on purpose.

Former US treasury secretary Larry Summers had accused the administration earlier this week of making "the most egregious accounting error in a presidential budget" in the 40 years he had been tracking them. 

Summers, who was also chief economist at the World Bank, shone his spotlight on the budget's forecasts of as much as $2tn in additional federal revenue growth over the next decade, which the document said would be used to fund Trump's so-called "biggest tax cut in history".

He then pointed to other budget plans to use the very same amount to reduce the deficit.

Former US treasury secretary Larry Summers. Picture by: Jason Alden/PA Archive/PA Images

Summers wrote on his blog:

"My observation is that there appears to be a logical error of the kind that would justify failing a student in an introductory economics course."

He also maligned the budget overall as "simply ludicrous".

Although Summers had previously worked under the Obama administration, a leading conservative economist also noted the discrepancy.

American Action Forum president Douglas Holtz-Eakin told the Los Angeles Times that the numbers "don't seem to match".

Now, the White House has responded that that was all part of the plan.

OMB Director Mick Mulvaney testifies before a House Budget Committee hearing titled "The President's FY2018 Budget" on May 24th, 2017. (Photo By Tom Williams/CQ Roll Call)

White House budget director Mick Mulvaney told reporters at a press briefing on Tuesday:

"We stand by the numbers."

"The money can be used to both reduce the budget deficit and offset Mr Trump's proposed tax cuts," Mulvaney explained.

"There's other places where we were probably overly conservative in our accounting."