Thursday, June 7, 2012

The Long-Term Budget Outlook

Ethan Pollack presents some interesting projections of the projected public debt to GDP ratio through 2087 arguing that our long-term budget outlook has improved dramatically. I’m sure this contention will be controversial in some circles – especially among those Republicans who insist we need austerity now despite the fact that we still have a severe underemployment situation. He places some appropriate caveats to these CBO projections including this at the end of his blog post:
this report clearly shows that the path toward fiscal sustainability includes allowing some—if not all—of the Bush-era tax cuts to expire and fully implementing and protecting the Affordable Care Act.
Odd – the Republican nominee for the Presidency wants to repeal the Affordable Care Act and extend if not magnify those Bush tax cuts. He is also calling for increases in defense spending as he pretends to be for fiscal responsibility. Is there some alternative arithmetic where this all adds up?

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