EXTRACT
“Long-term
fiscal simulations by GAO, CBO, and others all show that despite some modest
improvement in near-term deficits, we face large and growing structural
deficits driven primarily by rising health care costs and known demographic
trends. In fact,
the long-term fiscal challenge is largely a health care
challenge.
Although Social Security is important because of its size, the real
driver is health care spending. It is both large and projected to grow more
rapidly in the future.
GAO’s current long-term simulations show ever-larger
deficits resulting in a federal debt burden that ultimately spirals out of
control… (There are) two alternative fiscal paths. The first is “Baseline
extended,” which extends the CBO’s baseline estimates beyond the 10-year
projection period, and the second is an alternative based on recent trends and
policy preferences. Our alternative scenario assumes action to return to and
remain at historical levels of revenue and reflects somewhat higher
discretionary spending and more realistic Medicare estimates for physician
payments than does the baseline extended scenario. Although the timing of
deficits and the resulting debt build up varies depending on the assumptions
used, both simulations show that we are on an unsustainable fiscal path.
The bottom line is that the nation’s longer-term
fiscal outlook is daunting under any realistic policy scenario or assumptions. Continuing
on this unsustainable fiscal path will gradually erode, if not suddenly damage,
our economy, our standard of living, and ultimately our national security. Our
current path also increasingly will constrain our ability to address emerging
and unexpected budgetary needs and increase the burdens that will be faced by
future generations.”
…
"If the American people understand that there is no magic
bullet—if they understand that
• we cannot grow our way out this problem;
• eliminating earmarks will not solve the
problem;
• wiping out fraud, waste and abuse will
not solve the problem;
• ending the “Global War on Terrorism”,
exiting from Iraq,
or cutting way back on defense will not solve the problem; and
• letting the recent tax cuts expire will
not solve this problem;
then they can engage with you in a discussion about
what government should do; how it should do it; and how we should pay for it
without unduly mortgaging the future of our country, children, and
grandchildren. This is a great nation, probably the greatest in history. We
have faced many challenges in the past and we have met them. It is a mistake to
underestimate the commitment of the American people to their country, children,
and grandchildren; to underestimate their willingness and ability to hear the
truth and support the decisions necessary to deal with this challenge. We owe
it to our country, children and grandchildren to address our fiscal and other
key sustainability challenges. The clock is ticking and time is working against
us. The time for action
is now."
