Congressional Budget Office: Fiscal Outlook «Worsened Dramatically»
Someone Has to Pay the Fiscal Gap
(Washington D.C.) – According to a new report from the Congressional Budget Office (CBO), «the long-term outlook for the federal budget has worsened dramatically over the past several years.» The CBO reports that this growing debt «may significantly hinder economic growth» and that without substantial change to current law, the federal debt held by the public would exceed 100 percent of GDP in just 25 years. The CBO findings come on the heels of a study by the Mercatus Center which identifies a $210 trillion «fiscal gap» for the federal government. This gap represents the difference between federal commitments going forward – including benefits such as Social Security – and projected tax revenues. The report concludes that the timing of any potential tax increase enacted to close that gap will determine which generation will pay the bill. The current national debt of over $18 trillion pales in comparison to the fiscal gap, so much so that government would need to collect the equivalent of an additional 10.5 percent of all future GDP in taxes each year, according to the study.
Daniel Garza, Executive Director of The LIBRE Initiative, released the following statement:
«Our awful fiscal condition is the consequence of an expanding government and reckless spending without accountability. The nonpartisan CBO has made clear the dangers of our current path, which is the direct result of the lack of a long-term vision and the refusal of our leaders to be honest about our fiscal problems.
Undoubtedly, either this or future generations will have to pick up the bill for these big-government expenses. While the debt could be mitigated by making reasonable decisions to limit the reach of government and eliminate wasteful spending, unfortunately the Obama administration has done the opposite. Thus, our best hope is for lawmakers to work in tandem with the next administration to put forth a plan that will reduce the size of government and ensure we do not burden future generations. We can get out of this debt, but need adjustments on spending to spur greater opportunity.»