I was pleased to have an opportunity to speak this morning to the National Association for Business Economics about the budget outlook.
My presentation addressed the factors putting pressure on the budget, the consequences of high and rising federal debt, and some of the criteria that might be used to evaluate potential policy changes. The presentation drew on CBO’s reports on The Budget and Economic Outlook: Fiscal Years 2013 to 2023, Macroeconomic Effects of Alternative Budgetary Paths, and Choices for Deficit Reduction.
I concluded the talk by emphasizing a key implication of CBO’s budget projections: Given the magnitude of the imbalance between revenues and spending that will result under current policies, putting the debt on a sustainable path will ultimately require increases in taxes or cuts in government benefits or services for people who consider themselves to be in the middle class.
My slides can be viewed below.