WASHINGTON -- While there has been some recent good news for the federal budget, The Concord Coalition said today that updated projections from the Congressional Budget Office (CBO) should remind policymakers that the aging of the population is dramatically but predictably reshaping government spending and fiscal reforms are the only way to prevent the negative economic consequences.
“Despite a slowing of health care inflation and lower annual deficits since their heights during the recession, the CBO’s projections demonstrate that our basic structural problem remains -- growth in just a few programs due to the retirement of the baby boom generation, combined with increasing debt service, have and will continue to push our federal debt to levels not seen since World War II. This will lead to lower standards of living and slower economic growth if we don’t act soon,” said Robert L. Bixby, executive director of The Concord Coalition.
The CBO report offers 10-year baseline projections for the nation’s spending programs and revenue collection along with newly updated economic projections. When viewed along with their recent updated long-term budget projections, the picture is clear: spending on Medicare, Medicaid and exchange subsidies, Social Security, and net interest will grow by 3.4 percent of GDP, while all other spending programs are projected to shrink by 2.0 percent of GDP.
The Concord Coalition also updated its “Plausible Baseline” which applies more realistic assumptions about future policy decisions to the CBO’s data. Under these assumptions, annual deficits over the next 10 years will be $2.3 trillion greater than in CBO’s official baseline.
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