Sep 01, 2011
By Scott Bittle
Politicians love blame, as long as it isn’t directed at themselves. And with the federal deficit an issue in the upcoming election, both Republicans and Democrats are working hard to blame the other side for the problem.
The striking thing is that while our political leaders have largely dodged our fiscal problems, the government’s own auditors and accountants have been strikingly consistent about what’s happening to the federal budget and why.
All three of the government’s budget agencies use the same word to describe the federal budget: unsustainable. What’s more, all three – the Congressional Budget Office, the Government Accountability Office, and the White House Office of Management and Budget – agree on the reasons for this, namely, the combination of rising health care costs and an aging population that are going to drive up spending on Medicare, Medicaid and Social Security.
Finally, the budget agencies have been consistently saying this for years. They said it under President Bush, and they’re saying it under President Obama. They said it both before and after the Great Recession. Two of these agencies, the CBO and GAO, are devoutly nonpartisan. But the third, the Office of Management and Budget, are the president’s own budget analysts – which means both administrations see the long-term problem on the horizon.
On the campaign trail, the Republicans and Democrats can and will argue about the Bush tax cuts and Obama’s health care plan; about the Wall Street bailout and the economic stimulus. All of these shape the way the specific budget numbers add up. But it’s important to remember that the bottom line, the final verdict of the budget experts has remained the same. The federal budget is on an unsustainable path, and the primary reasons are these big-picture trends in health care and demographics.
So the real question voters may want to ask candidates isn’t “who is to blame,” but rather “what are you going to do to get out of this?
There’s blame enough to go around – but also lots of practical solutions.
Still not sure? Let’s go to the sources.
Under President Bush:
Simulations are not forecasts or predictions. They are designed to ask the question “what if?” GAO’s “what ifs” are that discretionary spending may grow faster or slower, and tax cuts may be renewed or allowed to expire – but in both cases, the Nation’s long-term fiscal future is “at risk.” Under any reasonable set of expectations about future spending and revenues, the risks posed to the Nation’s future financial condition are too high to be acceptable.
Significant uncertainty surrounds long-term fiscal projections, but under any plausible scenario, the federal budget is on an unsustainable path—that is, federal debt will grow much faster than the economy over the long run.
Under current policies, the increase in the senior population coupled with rising health care costs will put an unsustainable burden on Medicare, Medicaid, and Social Security in the coming decades…Without reforms in the near-term, the dramatic increases in spending for these programs will ultimately require substantial tax increases, major benefit reductions, or massive and unsustainable amounts of borrowing.
Under President Obama:
Our long-term simulations show that absent policy changes the federal government faces an unsustainable growth in debt.
Under current laws and policies, an aging population and rapidly rising health care costs will sharply increase federal spending for health care programs and Social Security. Unless revenues increase at a similar pace, such spending will cause federal debt to grow to unsustainable levels.
Even with the defcit reduction measures that this Administration has enacted and proposed, the Nation remains on an unsustainable fiscal course… And while, over the long term, the Affordable Care Act will help significantly to reduce deficits, health care costs are still expected to continue to consume a growing share of the Federal budget for decades to come. In addition, the aging of the population will add to the fiscal pressure the Government already faces because of the irresponsibility of the past and the fiscal pressure it will continue to face in coming decades.
Scott Bittle is director of public issue analysis at Public Agenda, a partner in Choosing Our Fiscal Future. With his colleague Jean Johnson, he’s co-author of “Where Does the Money Go: Your Guided Tour to the Federal Budget Crisis” and “Who Turned Out the Lights? Your Guided Tour to the Energy Crisis.”