By Nick Timiraos
The Trump administration has drafted preliminary economic growth forecasts in its federal budget planning that rely on assumptions that are far rosier than projections made by independent agencies and most private forecasters, according to several people familiar with the discussions.
The forecasts are being revised, these people said, following an internal debate. One concern is that pressing staff economists to produce unrealistic forecasts might undercut the credibility of top appointees forced to later defend those numbers.
The deliberations show the challenge the administration faces as it tries to reconcile the competing goals of cutting taxes, boosting military and infrastructure spending, preserving Medicare and Social Security programs and keeping budget deficits from soaring.
Economic growth forecasts are presented as part of White House budget submissions to Congress and are due out from the Trump team in the coming weeks. They have an important impact on projected debts and deficits. A fast-growing economy produces more revenue while reducing the need for spending on programs such as food stamps or unemployment insurance. Fast growth estimates can thus hold down projected deficits.
Popular on WSJ.com: