Voters are hearing promises of big tax cuts from the Republican presidential candidates and big spending increases from the Democrats.
But Concord Coalition Executive Director Robert L. Bixby points out that the nonpartisan Congressional Budget Office (CBO) last week released projections for the next 10 years that cast serious doubt on how realistic or responsible those campaign promises are.
For example, CBO projects that in Fiscal 2018, the deficit will be $572 billion. By the end of the next president’s first term, under current law the deficit will be back above $1 trillion – and will continue rising after that.
CBO also warns that debt held by the public could grow from 76 percent this year to 86 percent in 2026 – far above the 39 percent average for the past half-century.
In a new blog post, Bixby says the CBO’s projections should serve as a reality check for the candidates.
“This is not a scenario that calls for spending increases or tax cuts, even if offsetting actions are taken to ‘pay for’ them,” he writes. Such offsets would still leave the budget on an unsustainable path.
Bixby adds: “The basic dynamic, long warned of and now coming true, is that spending growth on the major entitlement programs is outpacing revenue growth, squeezing out other programs and adding to the debt.”
The CBO’s projections detail how this will happen, with most of the spending growth driven by health care programs, Social Security and interest on the debt.
The Budget and Economic Outlook: 2016 to 2026 (CBO)
New Budget and Economic Data Page (CBO)