The July 12, 2016 report from the Congressional Budget Office confirms what we’ve known for some time – that last year’s fiscally irresponsible legislation has worsened an already dismal long-term fiscal outlook.
Last year, CBO warned debt would rise from a post-war record of 75 percent of GDP today to 107 percent of GDP by 2040; this year they project it will rise to 122 percent of GDP by 2040, and keep growing after that to 141 percent three decades from now.
This trajectory cannot continue. It is a virtual roadmap to financial peril. CBO warns that high and rising levels of debt will slow income growth, increase interest costs, crowd out important budget priorities, limit the ability of lawmakers to respond to a crisis, and increase the likelihood of a fiscal crisis.
The largest driver of the growth in long-term debt is the one area neither presidential candidate has a plan to address: entitlement spending. Policymakers should act quickly to reform these programs in order to slow the growth of health care and make Social Security solvent.
The presidential candidates should step up and address our dangerous long-term debt trajectory with constructive solutions and real leadership, not continuing to duck these challenges as they have so far.
The longer we wait to act, the more painful the adjustments will be. So let’s start the discussion today.
For more information, contact Patrick Newton at [email protected].
For more information about the Fix the Debt Campaign, please visit www.fixthedebt.org.
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