If current federal tax and spending policies remain unchanged, U.S. debt held by the public will reach 77 percent of gross domestic product by 2025, "up from 74 percent at the end of 2015 and roughly twice the 38 percent average of the past five decades," according to a presentation given by Congressional Budget Office Director Keith Hall on Wednesday.
The federal budget deficit for fiscal 2015 is at its smallest since 2007, but Hall says that over the next 10 years, "federal spending is projected to rise relative to the size of the economy because of the growth in health care and retirement programs and escalating interest costs."
Some of that increased spending on medical and retirement programs is driven by rising life expectancies and an aging baby boomer population, with about a third of Americans expected to join the 65-and-older demographic within the next decade, according to The Daily Caller.
"To put the federal budget on a sustainable path for the long term, lawmakers would have to make major changes to tax policies, spending policies, or both - by reducing spending for large benefit programs below the projected amounts, letting revenues rise more than they would under current law, or adopting some combination of those approaches," Hall said.
The current two-year bipartisan budget deal proposal, which passed the House Wednesday and is now under consideration in the Senate, would reduce deficits by about $80 billion over the next 10 years, the CBO said Wednesday, according to Reuters.
While the legislation would ease mandatory spending caps and increase discretionary spending by $80 billion over the next two years, the CBO says it would produce larger savings over the long haul.
The plan would result in a net deficit increase of $4.6 billion in fiscal 2016 and $53 million in 2017, however, from 2018 to 2025, it would show annual deficit reductions of $4.9 billion to $9 billion, according to the CBO.
Approximately $32.3 billon would be added in revenues over the 10-year period, largely from provisions relating to tax compliance, health care and pensions. Outlays would be reduced by an estimated $47.6 billion, reports Reuters.
Sen. Rand Paul, the libertarian-ish Republican presidential candidate from Kentucky, said during Wednesday night's GOP debate that he plans to filibuster the budget deal.
"This is exactly the opposite of what every conservative Republican in America wants, and I'm going to do everything I can to stop it," Paul told The Hill the day before the debate. "I will filibuster it, I'll delay it, I'll shout about it. I'm going to talk about it until I'm tired of talking about it and until people wake up and say this is wrong for the country."
Paul continued: "I think raising the debt ceiling with no limit is absurd, wrong, a recipe for unlimited spending. I think busting the budget caps is exactly the wrong thing we should do. We should use the leverage of the debt ceiling to try to get spending reform, not give up on spending reform."
