- Under the CBO baseline, interest costs would more than double as a share of the economy. Under the Alternative Scenario, interest costs would rise to nearly $1 trillion in 2023 alone (up from $857 billion in the baseline). This would be more than projected spending on non-defense discretionary spending, or defense spending, or any other federal program other than Medicare and Social Security.
- In CBO's baseline projections, mandatory spending would increase from 13.2 percent of GDP in 2014 to 14.1 percent in 2023. This increase is driven entirely by Medicare, Medicaid and Social Security (together accounting for over half the total federal budget). The remaining mandatory spending programs are projected to shrink from 3.1 percent of GDP to 2.4 percent -- representing the unwinding of automatic stabilizers as the economy recovers.
- The number of Social Security recipients is expected to grow by 40 percent between 2012 and 2023.
- Medicare will absorb approximately 18 million new beneficiaries during the same time period -- growth that is more responsible than health care inflation for increased programmatic spending.
- Under CBO's baseline, which assumes that the "automatic" cuts required by the Budget Control Act will take effect, discretionary spending would decrease from 7.6 percent of GDP in 2013 to 5.5 percent by 2023 -- the lowest level in the last 50 years.
New CBO Numbers Show Much Unfinished Business
Check Out Our Best Services for Investors
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
More than 30 investing pros with skin in the game give you actionable insight and investment ideas.