Annual budget deficits are projected to soon surpass $1 trillion, on their way to $2 trillion or even $3 trillion in 10 to 15 years. Social Security and Medicare face a combined $100 trillion cash deficit over the next 30 years, which would push the national debt to nearly 200 percent of the gross domestic product (GDP). At that point, interest on that debt would consume 40 percent of all tax revenues—or more, if interest rates rise. Unless reforms are enacted, global markets will, at some point, stop lending to the U.S. at plausible interest rates. When that event occurs, or even approaches, interest rates will soar, and the federal government will not be able to pay its bills, with dire consequences for the U.S. economy.
Brian Riedl is a senior fellow in budget, tax, and economics at the Manhattan Institute
October 19, 2018, 2:42 PM EDT
August 13, 2018, 11:21 AM EDT
Last week, left-wing politicians, activists, and columnists gleefully rejoiced that they had unlocked the easy path to single-payer health care in America: Just cut reimbursement payments to health providers by 40 percent and then raise taxes by $32 trillion over the decade. You know, nothing difficult or controversial.
July 12, 2018, 11:40 AM EDT
The 2017 Tax Cuts and Jobs Act (TCJA) remains controversial, with public opinion evenly split and many Democrats campaigning on repeal. However, the Democratic critique of the tax cuts has grown increasingly incoherent. The party excoriates the “tax cuts for the rich” while trying to tilt them even further to the wealthy. Democrats slam the deficit effect of the tax cuts while working to worsen budget deficits. In addition, they erroneously describe the law as a “middle-class tax hike” while proposing policies that would truly raise middle-class taxes.
April 16, 2018, 10:09 AM EDT
Let the political bloodbath begin.
April 11, 2018, 2:36 PM EDT
In the Washington Post, a distinguished group of liberal economists argues that entitlements are not chiefly to blame for the coming deluge of debt. Specifically, Martin Neil Baily, Jason Furman, Alan Krueger, Laura D’Andrea Tyson and Janet Yellen – all former Democratic chairs of the White House Council of Economic Advisers – dispute a group of Hoover Institution economists who had earlier shown that long-term deficits are determined by escalating entitlement program costs.
April 5, 2018, 12:05 PM EDT
President Trump – incensed by the 2,232-page, $1.3 trillion monstrosity of an omnibus appropriations bill that he just signed into law – has asked lawmakers to provide him with a line-item veto, which would allow him and future presidents to veto individual spending and tax provisions within larger bills.
March 23, 2018, 11:02 AM EDT
And not a single lawmaker has read it.