The Return of Trillion-Dollar Deficits
For Immediate Release
The Congressional Budget Office (CBO) released its Budget and Economic Outlook for the next decade this afternoon, which warned that the national debt is headed to uncharted waters. Under current law, CBO projects debt will rise from 80 percent of the economy today to 98 percent by 2030 and 180 percent by 2050. Should policymakers continue to extend tax cuts and grow discretionary spending with the economy, debt will grow far higher and by 2030 would likely exceed the record levels set just after World War II. Read more in our quick summary blog here, to be followed later today with a fuller analysis.
The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
We’re running trillion-dollar deficits while the economy is expanding – when are lawmakers going to wake up? Every year we set a new post-war record for debt as a share of the economy, every year the Congressional Budget Office warns that debt is rising unsustainably, and every year our largest trust funds get closer to depleting their reserves. Ignoring what is staring us right in the face is fiscal malfeasance.
A trillion-dollar deficit is not a milestone to be proud of, nor one to brush aside. Over half of the deficit is due to the choice of policymakers to borrow to fund recent tax cuts and spending increases. CBO’s report confirms that not only are we in uncharted waters, but that we are also leaving future generations with an incredible burden.
Interest is the fastest growing part of the federal budget – it is projected to more than double over the next ten years. These trends don't reverse overnight. We can no longer afford to procrastinate.
To avoid reaching World War II levels of debt, lawmakers and political leaders must begin by committing to stop making things worse. No more unpaid-for tax cuts or spending programs – if something is worth doing, find an offset. On top of that, we should work together to secure our major trust funds and identify the new taxes and spending reforms needed to put our debt on a more sustainable trajectory.
Lawmakers should all take the Hippocratic oath to stop making things worse – no more charging new things to the nation’s credit card. And then instead of the current plan to borrow $14 trillion over the next decade, they should come up with a sustainable budget plan that doesn’t threaten the future of this country as the current one does.