Nation's Budget is Still in Danger in the Long-Term
March 11, 2015
The Congressional Budget Office's (CBO) latest "Updated Budget Projections: 2015 to 2025" shows that while deficits are projected to remain flat through 2018, they could see a steep rise soon after. The report also shows that spending is on the rise, from its 2014 level of 20.3 percent of Gross Domestic Product (GDP) to 22.1 percent of GDP by 2025, propelling deficits to the trillion-dollar mark by the end of the decade in 2025. The CBO report shows excessive spending and high deficits are lurking just beyond the veneer of temporary progress.
Lawmakers could put the nation's budget on a path to balance instead of ignoring long-term fiscal dangers. Here are three steps Congress can take to achieve that:
- Reform the three major entitlements: Spending on Medicare, Medicaid and Social Security together with net interest is projected to account for 85 percent of spending growth. Entitlement reform could focus on providing benefits to those who truly rely need them in a cost-effective way.
- Eliminate wasteful and improper spending. Congress could establish a mechanism that can effectively identify and root out wasteful and duplicative spending and end programs that fall outside the purview of the federal government.
- Control spending with firm caps. Congress could implement spending caps that will curb long-term spending growth as a requisite for any increases to the debt limit.
Congress could take these steps to curb government spending in the future and save the next generations from being mired in excessive debt.
Source: Romina Boccia, Michael Sargent, "New Report: Over Next Decade, Budget Deficits Will Hit Trillion-Dollar Mark," The Daily Signal, March 09, 2015.
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