Washington, D.C.– The next few weeks could have a major impact on America’s fiscal future, with a vote on tax reform coming soon and a second short-term continuing resolution set to expire at the end of the month.
In October, BPC’s economic policy team warned that the collision of three expensive budget items—a tax reform package with a $1.5 trillion price tag, additional disaster relief spending, and increased spending for defense and non-defense programs—would cause the federal deficit to balloon to more than $1 trillion as early as Fiscal Year 2019. As budget negotiations continue, despite some expected offsets, this detrimental fiscal outlook appears likely to materialize and even be exceeded.
“Our current debt trajectory was on an unsustainable path before this month began, it will only get worse after this month is over,” G. William Hoagland, BPC senior vice president, said. “Everyone can take some share of the blame, but now that we’re here, the real question is, what should we do about it? Decision makers need to make the hard choices necessary to rein in mandatory spending, raise more – not less – revenue, and stabilize the national debt at a responsible level.”
For a decade, BPC has formulated pragmatic, evidence-based, and fiscally responsible solutions to our nation’s most complex policy challenges. Now is the time for solutions like these:
- Taxes and Spending: The 2010 Domenici-Rivlin Debt Reduction Task Force proposed a mix of revenue and spending changes that would have placed debt held by the public on a sustainable path. Many of these recommendations remain unaddressed.
- Social Security and Retirement: Last year, BPC’s Commission on Retirement Security and Personal Savings recommended a balanced package of revenue and benefit adjustments to preserve Social Security indefinitely and also dramatically reduce poverty among older Americans.
- Defense Spending: BPC’s Task Force on Defense Personnel proposed policies that would rebuild the U.S. military in a fiscally responsible manner—by trimming excess, cutting red tape, and eliminating waste, fraud, and abuse.
- Health Care: BPC has also proposed recommendations for system-wide health care cost-containment that would improve quality, eliminate waste, and ultimately produce a high-value, coordinated health care system.
Congress’s to-do list over the next several weeks is extensive. Important issues like DACA, CHIP, disaster funding and national security are all part of the year-end Rubik’s cube. Several Republican senators’ votes on the final tax reform package depend upon one or more of these issues, which further complicates negotiations—and underscores the need for a balanced approach.
“With so many issues converging this month, from tax reform to possibly passing an omnibus spending bill, we urge policymakers to exercise bipartisanship and fiscal discipline,” Hoagland said. “Otherwise, our children and grandchildren will be stuck with a massive load of debt.”