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Nationís Long-Term Fiscal Outlook: April 2007 Update: The Bottom Line: Federal Fiscal Policy Remains Unsustainable
Barry Leonard (ed)
Since 1992, GAO has published long-term fiscal simulations of what might happen to fed. deficits & debt levels under varying policy assumptions. Current long-term simulations show ever-larger deficits resulting in a fed. debt burden that ultimately spirals out of control. There are two alternative fiscal paths. The first is ďBaseline extended,Ē which extends the CBOís baseline estimates beyond the 10-year projection period, & the second is an alternative based on recent trends & policy preferences. For this update, GAO modified the alternative simulation to reflect a return to historical levels of revenue & a more realistic Medicare scenario for physician payments. Both simulations show that we are on an unsustainable fiscal path. Charts & tables.
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