the national debt that is often cited by government agencies and media outlets. In 2014, CBO projected that this debt would grow over the next two decades to unprecedented levels unless the government changed its policies. Two and half years later, the actual outcomes are slightly worse:
Federal Government Shortfall
The vast bulk of current and impending federal debt is due to increased spending on social programs like Medicare, Social Security, Medicaid, and food stamps. Such programs have grown from 21% of federal spending in 1960 to 63% in 2015. Under current laws and policies, the Congressional Budget Office projects that almost all future growth in spending will be due to these programs and the interest on the national debt.
It is often impossible to objectively isolate the effects of a single factor (like the national debt) on an economy. However, a broad range of evidence indicates that excessive government debt can cause far-reaching negative outcomes, such as lower wages, weak economic growth, increased inflation, higher taxes, reduced government benefits, or combinations of such results.
The Government Accountability Office has warned that “the costs of federal borrowing will be borne by tomorrow’s workers and taxpayers,” and this “may reduce or slow the growth of the living standards of future generations.” This may have already begun. The national debt has risen dramatically over the past decade, and with this, the U.S. has experienced historically poor growth in gross domestic product, productivity, and household income.
Reprinted from Just Facts Daily.
James Agresti
James D. Agresti is the president of Just Facts, a nonprofit institute dedicated to publishing verifiable facts about public policy.
This article was originally published on FEE.org. Read the original article.
