Chart 8 shows historical and estimated receipts, program spending, and primary deficits expressed as shares of GDP from 1980 to 2083. Program spending grew rapidly in 2008 and 2009 due to the financial crisis and the recession and the policies necessary to combat both, and is expected to fall in the next few years as the economy recovers. Starting in 2014, however, rising health care costs and, to a lesser extent, the aging population, are expected to cause program spending as a share of GDP to rise continuously from 19 percent in 2014 to 25 percent in 2040 and 29 percent in 2080. This reflects the expectation that heath care spending per person will continue to grow faster than will the economy as a whole and also reflects the movement of the 78 million ‘baby boomers’ (those born between 1946 and 1964) from work to retirement.
Saturday, July 30, 2011
U.S. Government Accountability Office
In light of the high unemployment rate and the devastating effects that unemployment has on American families, the Government’s immediate focus is on encouraging private sector job creation. But the Government must simultaneously address the medium- and long-term fiscal imbalance resulting from past budget deficits, the impact of the economic downturn, and demands on the nation’s social programs, notably Medicare, Medicaid, and Social Security. As currently structured, the Government's fiscal path cannot be sustained indefinitely and would, over time, dramatically increase the Government's budget deficit and debt (see Chart 2).