WASHINGTON -- Projections released today by the Congressional Budget Office (CBO) provide further evidence that candidates for federal office should address the nation’s worsening budget problems, according to The Concord Coalition.
“Voters are hearing a lot of expensive new proposals from candidates but not so much about how to keep the nation’s debt from growing on an unsustainable path,” said Robert L. Bixby, Concord’s executive director. “Today’s CBO report, which projects a rising debt burden over the next 10 years and beyond, shows why voters should expect candidates to offer credible policies to put us on a better course.”
The new report updates the budget and economic projections that CBO made earlier this year for the coming decade. Its baseline budget projections are based on current law and do not take into account deficit-increasing policies that tend to get passed on a yearly basis, such as the extension of various tax breaks.
CBO projects that Fiscal Year 2016 will close in September with the first increase in the deficit as a share of the economy since 2009, when the country was struggling with the fiscal consequences of the Great Recession. At $590 billion, the annual deficit will be $152 billion larger than in 2015 and $56 billion higher than the agency estimated in March. However, the 10-year cumulative deficit estimate of $8.6 trillion is $700 billion lower than the March projection -- primarily due to lower projections of interest rates.
The report shows growing pressure on the federal budget as the result of an aging population and rising health care costs. These factors increase the costs of Social Security and Medicare -- just to provide the same services to more recipients.
“As in the past,” Bixby says, “CBO is pointing toward a structural mismatch between the federal government’s spending and tax policies. With a strengthening economy, elected officials should address this mismatch as soon as possible to put the budget on a more responsible course and avoid saddling future generations with massive government debt.”
Two reports earlier this summer also underscored the nation’s fiscal challenges. The CBO’s Long-Term Budget Outlook, released last month, makes clear that unless fundamental changes are made, federal finances will deteriorate even further after 2026. In June the Medicare and Social Security trustees issued their annual reports, calling for prompt reforms to put those critical programs on more sustainable paths.
Media Contact: Steve Winn (703) 254-7828, [email protected]
The Concord Coalition is a nonpartisan, grassroots organization dedicated to fiscal responsibility. Since 1992, Concord has worked to educate the public about the causes and consequences of the federal deficit and debt, and to develop realistic solutions for sustainable budgets. For more fiscal news and analysis, visit concordcoalition.org and follow us on Twitter: @ConcordC