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Budget Woes
The Chickens Come Home to Roost

Some grim news about the U.S. deficit, via Fix the Debt:

New projections from the non-partisan Congressional Budget Office (CBO) show the national debt and deficits rising rapidly, with debt rising by over $10 trillion over the next decade and deficits growing from $439 billion last year to $544 billion this year, and to $1.37 trillion by 2026. This represents a significant deterioration from previous projections.

“This report makes it abundantly clear that the era of declining deficits is over,” said Maya MacGuineas, head of the Campaign to Fix the Deb [. . .]

According to CBO, the national debt will rise from $13.1 trillion, or 74 percent of GDP last year, to $23.8 trillion, or 86 percent by 2026. This is significantly worse than CBO’s projections in August, which showed debt rising to 77 percent of GDP by 2025. In total, debt in 2025 will be $1.4 trillion higher than had been previously projected.

Interest rates were already raised in December, and if they continue rising, this is going to be an even bigger issue.

But, either way, the reality at play here—that we are facing rising deficits after a long period of sustained, if tepid, economic growth—points to just how irresponsibly the federal budget has been managed. Both President Bush and President Obama added enormously and unwisely to the country’s deficit and debt, and the consequences of these errors will haunt us for years to come.

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  • Beauceron

    The CBO includes a graph in their report that will make your jaw drop…

  • Jacksonian_Libertarian

    The burden of the Big Bloated Government Monopoly is crushing all the growth out of the economy, and destroying the American Dream.

    • Andrew Allison

      The American Dream has been replaced by the Grecian one that you can live large on other people’s money indefinitely.

  • Jim__L

    This is a good time for Paul Ryan (TEA Partier) to be Speaker of the House.

    It’s not a good time for him to go wobbly.

  • nervous122

    It’s even worse. Look at the CBOs rosy growth projections. In all likelihood, we’ll be over 100% of GDP.

  • Pete

    The debt will be repudiated by 1) selective defaults, 2) inflation and 3) government using financial repression.

  • rsnbleman

    It is easy to point out the growing deficit – more difficult to wrestle with the actual, primary cause which is the growth in health-care spending. Until we have the political and moral courage to simply begin the conversation that will, unfortunately, have to embrace the fact that our “health-care industrial complex” simply takes too much of our money – the deficit will continue to grow. Big Pharma, device makers, physicians, hospital administrators, insurance companies, insurance brokers, all work to protect a system that is twice as expensive as it needs to be because many of these players simply make “too much” money. It is not “big government” or “regulations” or any of the other bogeymen that get trotted out when health-care reform is discussed. I don’t know how to address this – Obamacare only tinkered at the edges and the GOP only wants to tinker in different ways. Until we squarely address this problem, and gore a bunch of sacred cows, the deficit will continue to balloon no matter who thinks they can solve it through gimmicks (like block grants for Medicaid) or just expanding access (like Obamacare).

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