Statement from Foundation President, Michael A. Peterson, on CBO’s Long-Term Budget Outlook
“The message of this CBO report is clear — the nation’s current fiscal path is unsustainable over the long term. A federal debt level of 200% of GDP within 25 years would place an unthinkable burden on the next generation — trillions in interest payments would crowd out much needed investments in our economy, and the safety net could be shredded as resources become scarce.
CBO also recently warned that the confluence of expiring tax cuts and automatic spending reductions occurring at the end of the year could lead to another recession if our current course isn’t altered. Our elected leaders should use the need to act on these year-end events as an opportunity to put in place a comprehensive bipartisan fiscal plan that gets implemented when the economy recovers. Agreeing on a plan that shows that America is getting its fiscal house in order would give the economy a badly needed boost of confidence in the short term, and put America on a much more sustainable and prosperous path for the long term.”
Further Reading
The Fed Reduced the Short-Term Rate, but Interest Costs Remain High
High interest rates on U.S. Treasury securities increase the federal government’s borrowing costs.
How No Tax on Overtime Will Affect Federal Revenues and Tax Fairness
This new, temporary deduction will cost $90 billion dollars over the next four years, while undermining tax equity and making the tax system more complex.
Infographic: The Facts About U.S. Defense Spending
National security is both a vital priority and a significant part of the federal budget.