Six Truths about the Deficit

James Carter has this new piece in Investors' Business Daily.

Truth No. 1: The CBO reported last week that the federal budget deficit is, under current law, expected to total $1.4 trillion this year and $6.7 trillion over the coming decade. At $1.4 trillion, this year's deficit is larger than the annual economic output of all but 10 foreign countries.

Truth No. 2: Because of these deficits, the publicly held federal debt is poised to almost double to $18 trillion within 10 years, nearly quadrupling annual net interest costs to $807 billion in the process!

Truth No. 3: While increased spending and depressed revenue both contribute to this year's federal deficit, the source of our long-term fiscal predicament is not a lack of revenues, but an overabundance of spending. . . .

Truth No. 4: Reducing federal spending in 2021 to its historical average of 20.8% would require a 13% across-the-board reduction in projected spending for that year. Excluding mandatory spending (e.g., Social Security, Medicare) and interest on the debt from the cuts would necessitate an unrealistic 46% reduction in defense and nondefense discretionary spending. Any serious effort to nudge the federal budget toward balance will require a concerted effort to restrain mandatory spending growth. . . .