According to CRFB President Maya MacGuineas, the government’s estimated borrowing for the fiscal year isn’t exactly growing, but that’s the cause for concern. “While the deficit didn’t rise from last year, it didn’t fall either, and we continue to borrow far too much. Our national debt is about the size of the entire U.S. economy and will exceed its highest ever record as a share of the economy—set just after World War II—in short order.” MacGuineas noted that the U.S. is on track to borrow nearly $2 trillion per year for the next decade. “How can anyone think this is sustainable?”
Reopening the government without attaching new borrowing strings should be a priority, the watchdog urged. In addition, CRFB called for extending the discretionary spending caps that have helped manage spending over the past two years and recommended enforcing a “Super PAYGO” rule—requiring $2 in offsets for every $1 of new spending or tax cuts—to encourage fiscal responsibility.
“The tragedy of the failure of governance we are witnessing,” MacGuineas asserted, is that political leaders have not been able to overcome their differences to do the hard budgeting work required. Without change, she warned, the United States risks losing its status as a global superpower.
The $1.8 trillion deficit faced last fiscal year reflects the ongoing challenges of balancing spending with revenues amid rising costs for healthcare, social programs, and national defense, alongside tax policies (namely, a reluctance to raise them) that limit revenue growth. The CRFB’s analysis paints a cautionary picture that stresses the urgency for bipartisan cooperation in Congress to enact sustainable fiscal policies.
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.
