CBO warning to Congress: national debt needs action, and soon

[Valin]

Christian Science Monitor:

Mark Trumbull
6/22/11

If Congress needed any extra incentive to work on fixes for federal budget deficits, it got one Wednesday in the form of a stark warning from its own accountant.

The Congressional Budget Office issued its annual long-term outlook for federal finances, and the overall message is simple: The problem of deficits and fast-rising debt is large, if anything even larger than the official forecast implies.

The challenge isn't impossible to fix, the CBO said. But delay will only make the problems worse.

(Snip)

The Hill: Dems call for stimulus in debt deal as CBO offers warnings

What a SHOCK! Democrats answer Spend more

[Valin]

NRO: Outlook: Grim

Yuval Levin

6/22/11

 

This morning, the Congressional Budget Office released its updated long-term budget projections. Needless to say, the picture is very unpleasant.

 

The basics haven’t changed all that much from last year’s extremely grim projections, but our troubles are coming at us faster. The debt projections in the document are the easiest way to see that. In last year’s Outlook document, CBO projected that our national debt would be 91% of GDP in 2021; they now say it will be 101% of GDP in 2021—that is, a decade from now our debt will be larger than our economy, and of course still growing quickly. By 2030, they project it will top 150% of GDP, and by 2037 it will be 200% of GDP. They assume it will continue to grow swiftly after that, but (although they extend long-range projections for spending and revenues all the way to 2085) their specific numerical projections for debt stop after 2037, when we cross 200% of GDP. We should probably be grateful for that, as the figures beyond that would only depress us all the more.

(Snip)