by Matt Rosenberg August 28th, 2012
A recently released report and infographic from the U.S. Congressional Budget Office warn that Congress should stick to its guns and execute the intent of the federal deficit reduction laws it has passed in recent years, or risk putting the nation on an “unsustainable” fiscal path. Ending as planned a wide range of existing tax cuts including two percent off the Social Security payroll tax, plus making other planned benefits reductions to Medicare and unemployment, and allowing the planned triggering in 2013 of automatic cuts in discretionary and mandatory federal spending, would cut the federal deficit from a projected $1.1 trillion at the end of fiscal 2012 (ending Sept. 30) to $640 billion in fiscal 2013, says CBO.
Sticking to the planned 2013 reforms will shave away some economic growth and keep unemployment slightly higher, but more importantly, says CBO, it will prevent the federal public debt from soaring to 90 percent of Gross Domestic Product, a level not seen since World War 2. The infographic concludes, “Because current policies would ultimately lead to an unsustainable level of federal debt, policymakers will need to adopt – at some point – policies that will require people to pay significantly more in taxes, accept substantially less in government benefits and services, or both.”
Here below in three parts is the infographic prepared by CBO. Use your Web browser’s “zoom in” feature to increase the size of the print, as needed. Or view it here.