Washington, D.C. – The Congressional Budget Office today released a summary of its budget and economic outlook for 2016 to 2026, and their worsening projection is another reason that Washington must stop turning a blind eye to debt and deficits, Steve Bell, senior director of economic policy at the Bipartisan Policy Center, said.
“The Congressional Budget Office’s forecast that federal deficits will increase during the next decade confirms most budget analyst’s projections. Fiscal Year 2016 will see a deficit of $544 billion, which is $139 billion higher than the FY16 projection by CBO just last August. According to this projection, this year will be the first since 2009 in which the deficit is increasing. An extremely high level of debt is now projected of 86.1 percent of GDP by 2026,” Bell said.
“Once again entitlements such as Social Security and Medicare are driving deficit increases. Spending for Medicare, Medicaid, and the Children’s Health Insurance Program, plus subsidies for health insurance purchased through exchanges and related spending will be 11 percent, or $104 billion, higher in FY16 compared to FY15,” Bell said.
“Congress exacerbated the problem by increasing spending and tax expenditures last December, with very few cuts in other areas to offset the increases,” he said.
“While one can argue about the economic forecast of improving growth and the direction of interest rates, the fundamental CBO thesis is that deficits and debt continue to grow. Turning a blind eye to the problem, as so many congressional and presidential candidates have done, merely means they are passing the buck to the next generation as concerns about political damage outweigh policy advantages,” he said.
Steve Bell is available for comment.