Washington, DC – Representative Reid Ribble (R-WI), a member of the House Budget Committee, today commented on the recently released long-term economic outlook from the Congressional Budget Office, which paints a clear picture of the looming fiscal crisis we face should Congress and the President continue to spend and borrow at such an unsustainable rate.

“This latest release from the CBO is just further evidence that our country is staring down the barrel of a loaded debt gun. We cannot continue to act as if a few small tweaks here and there will solve our economic crisis. For jobs to be created and our economy to grow, we simply must give business owners and job creators certainty. One way we must act is to get our arms around runaway federal spending which the CBO says is set to increase by 70 percent between now and 2035. This is the most predictable economic crisis in our history, and we must act responsibly to solve it. Waiting to address this issue will only serve to make the corrections more difficult for our children and grandchildren.”

CBO’s report includes the following key findings (Courtesy, House Budget Committee):

• The CBO projects that government spending as a share of the economy will increase by nearly 70 percent between now and 2035, up from its historical average of roughly 20 percent. Taxes are projected to rise to the historical average in the years ahead, yet the unprecedented growth in government spending is projected to rise much faster, driving an unsustainable explosion in debt.
  • The crushing burden of debt is driven primarily by the nation’s largest entitlement programs – Social Security, Medicare, and Medicaid – along with the compounding growth in interest payments on the debt. 
• These findings make plain that we cannot solve our biggest fiscal challenges by making tiny tweaks to programs here and there. As CBO Director Douglas Elmendorf put it recently, “Fiscal policy cannot be put on a sustainable path just by eliminating waste and inefficiency.”[1]
• Our unsustainable policies are increasing the likelihood of a devastating crisis: The CBO report states that “Growing debt also would increase the probability of a sudden fiscal crisis, during which investors would lose confidence in the government’s ability to manage its budget and the government would thereby lose its ability to borrow at affordable rates.”
• According to the CBO report, the federal government’s interest payments alone are projected to consume 9 percent of our entire economy by 2035, up from about 1 percent today.
• The CBO report affirms that the massive health-care overhaul fails to address the explosion in health care costs. Mandatory federal spending on health care will increase by 86 percent from 5.6 percent of GDP today to 10.4 percent of GDP over the next 24 years.
• The long-term budget outlook continues to worsen with each passing year Congress fails to act. While total debt will overtake the size of the entire US economy this year, debt held by the public will eclipse the economy by the year 2021.

To learn more about the House GOP’s plan to avert this crisis, visit http://budget.house.gov/fy2012budget/

Tomorrow at 10:00 AM, the House Budget Committee will hear testimony from CBO Director Elmendorf on the report’s findings. For more information on tomorrow’s hearing: http://budget.house.gov/HearingSchedule/#6232011

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