CBO: Fiscal Cliff Could Trigger a Recession

[Rudeboyelvis]

The CBO says that major changes to current tax or spending policies are necessary “to put the budget on a more sustainable path,” noting that these changes will require “significant trade-offs” between debt-reducing goals and other policy goals.

The CBO continues: “With the population aging and health care costs per person likely to keep growing faster than the economy, the United States cannot sustain the federal spending programs that are now in place with the federal taxes (as a share of GDP) that it has been accustomed to paying. To put the budget on a path that is more likely to be sustainable than if current policies were continued, lawmakers will need to adopt a combination of policies that require people to pay more for their government, accept less in government benefits and services, or both. However, making policy changes that are large enough to shrink the debt relative to the size of the economy — or even to keep the debt from growing — will be a formidable task.”

So just how big is the projected U.S. deficit and debt? According to CBO, the federal debt currently exceeds 70% of the nation’s annual output (gross domestic product, or GDP), a percentage not seen since 1950.




http://www.nacsonline.com/NACS/News/...rc=newsarticle