Nah let’s just borrow some more money from the Chinese…ooops they have decided to stop lending. Well then lets just sit around like a bunch of crying babies asking for handouts like the Government has trained so many of our fellow citizens to do. Oops that won’t work either!
This huge mass of debt, which would stifle economic growth and reduce the American standard of living, can be avoided only through spending cuts, tax increases or some combination of the two. And the longer government waits to get its financial house in order, the more it will cost to do so, the CBO says.
The CBO’s new long-term forecast is considerably more pessimistic than the one it issued 18 months ago, mostly because of the recession, which has driven the budget deficit above 12 percent of GDP. But the report makes clear that the recent economic downturn did not cause the government’s predicament and that the situation will not necessarily improve once the economy does. The principal cause of long-term fiscal distress is the aging of the U.S. population, coupled with rising health-care costs — which, together, will drive spending on Medicare, Medicaid and Social Security to new heights. Unchecked, federal spending on Medicare and Medicaid combined will grow from almost 5 percent of GDP today to almost 10 percent by 2035 — and to more than 17 percent of GDP by 2080. The Debt Tsunami – washingtonpost.com
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