The Federal government faces daunting budget challenges, according to Congress’ chief scorekeeper, which said that a churlish economy, low tax rates and increased spending on Social Security and healthcare are creating a volatile mixture for the U.S., The Washington Times reported.
According to the newspaper, in a best-case scenario, that means a fourth straight year of trillion-dollar deficits, covering the entirety of President Barack Obama’s first term in office and the debt level nearing $20 trillion by the end of this decade.
The Times reported that as Congress continues to extend tax cuts and higher rates of spending, the situation may become much worse, as a total of $10 trillion more in deficits for the next decade will occur.
“Beyond the coming decade, the fiscal outlook is even more worrisome,” the Congressional Budget Office said in its report. “Although long-term budget projections are highly uncertain, the aging of the population and rising costs for health care would almost certainly push federal spending up sharply relative to GDP after 2022 if current laws remained in effect.”
The New York Times reported that the deficit for 2012 will be roughly $200 billion less than in 2011, but the combination of higher taxes and caps on spending will crimp economic growth.