National Debt Doubles Under New CBO Estimate
Crapo notes analysis shows debt exceeding 100% of GDP
Washington, D.C. - Idaho Senator Mike Crapo has been warning about the growing federal debt during the nearly 90 town meetings he has held across Idaho since last fall. Now, the Congressional Budget Office (CBO) has issued a report adding to those concerns: left unchecked, the debt will double in two decades and could soon exceed the total economic output of the U.S.
"Our nation may not survive this forecast if we don't hold the line on spending," Crapo said. "Spending is out of control. Raising taxes is not the answer. We need to reform the tax code and get spending under control. We are taking in record amounts of tax revenue, yet our debt picture continues to drop precipitously. We are now in the position where simply paying the interest on the debt will soon exceed all of our other domestic spending programs. But if we will take that step to reform our mandatory spending programs, create strong spending enforcement measures and reform our tax code, economists say we will reap economic development that will create jobs and economic activity to help with our deficits."
Crapo, a member of the Senate Budget Committee, carries charts throughout his Idaho meetings demonstrating how, left unchecked, payments on the debt will exceed non-military discretionary spending by the year 2020 and all defense spending by the year 2023.
The CBO built on that model by forecasting the federal debt to double by 2040 if current tax and spending trends continue. The non-partisan agency said federal debt will reach 103-percent of the nation's gross domestic product (GDP) by that point. The present debt load is 74-percent of the GDP. Crapo says economists studying the economic history of nations worldwide have concluded few can survive such a debt-to-GDP ratio without suffering an economic collapse where interest payments would gut benefit payments and other government services for Americans.
"According to the new report, if lawmakers wanted the debt in 2040 to equal its 50-year average, it would require Congress to either raise taxes or cut annual spending by an additional $480 billion per year, every year for the next 25 years," Crapo added. "But, if Congress and the President continue to kick the can down the road, and don't start addressing the long-term debt until 10 years from now, Congress would either need to raise taxes or cut annual spending by about $775 billion per year, every year from 2026 through 2040.
"This report also reinforces how troubling it is that the President has threatened to veto any appropriations bill that does not spend more than the levels set in the spending caps that he himself signed into law just a couple years ago. When the government clearly can't afford the current levels and current path of spending, threatening to walk away from the table unless the government spends substantially more is simply irresponsible."
Next Article Previous Article