CBO's Budget Outlook

Just as the Republican National Convention was celebrating presidential candidate Bob Dole's conversion to the tax-cutting cause, a little rain was dumped on the GOP parade by budget analysts in Washigton.

A somber look at the nation's fiscal trends was sounded once again by the nonpartisan Congressional Budget Office as it released its 17th annual report on "Reducing the Deficit: Spending and Revenue Options". The report examines more than 200 options, including two that would cut the value of federal pension benefits for civil service retirees.

In no uncertain terms, the CBO report discounts the longer-term importance of balancing the federal budget by 2002, the fiscal objective most commonly espoused by both political parties at present. That goal is simply not enough to tame the deficit disease that will afflict the nation as the baby boom generation retires, CBO concludes.

"Unless permanent changes are made to relieve the long-term pressures on the deficit that arise with the aging of the baby-boom generation, simply balancing the budget by 2002 with one-time changes will not prevent the skyrocketing levels of debt that will occur in the early to middle decades of the next century," the report says. It adds that "serious efforts to reduce the deficit significantly will have to include substantial policy changes that go well behond merely continuing to restrain spending for annually appropriated programs, or so-called discretionary spending."

About half of discretionary spending is for national defense. The remainder funds housing, agriculture, education, environmental protection, law enforcement, space exploration, research and development, international assistance and other activities. Discretionary spending has been shrinking as a share of the federal budget, and now accounts for only about a third of the total.

The other two thirds comprises so-called "mandatory" spending, including interest on the national debt and the big benefit programs such as Social Security, Medicare, Medicaid and federal employee retirement. It is here that the problem lies. But there's little evidence that the Republicans meeting in San Diego have any appetite for proposing solutions to the entitlement problem at the moment. That's a posture that will doubtless be imitated by the Democrats when they meet in convention in Chicago later this month.

One of the entitlement reform options CBO covers would reduce federal retirement benefits directly. Another would do so less directly, by cutting back on cost-of-living adjustments in all non-means-tested benefit programs.

The 500-page CBO report is available in printed form from the agency's publications office: 202-226-2809. It will be online within the next few days as well at: gopher.cbo.gov:7100.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by Brocade

    Best of 2016 Federal Forum eBook

    Earlier this summer, Federal and tech industry leaders convened to talk security, machine learning, network modernization, DevOps, and much more at the 2016 Federal Forum. This eBook includes a useful summary highlighting the best content shared at the 2016 Federal Forum to help agencies modernize their network infrastructure.

    Download
  • Sponsored by CDW-G

    GBC Flash Poll Series: Merger & Acquisitions

    Download this GBC Flash Poll to learn more about federal perspectives on the impact of industry consolidation.

    Download
  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

    Download
  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

    Download
  • Sponsored by Aquilent

    A DevOps Roadmap for the Federal Government

    This GBC Report discusses how DevOps is steadily gaining traction among some of government's leading IT developers and agencies.

    Download
  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

    Download
  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

    Download
  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.

    Download
  • Sponsored by CDW-G

    Joint Enterprise Licensing Agreements

    Read this eBook to learn how defense agencies can achieve savings and efficiencies with an Enterprise Software Agreement.

    Download
  • Sponsored by Cloudera

    Government Forum Content Library

    Get all the essential resources needed for effective technology strategies in the federal landscape.

    Download

When you download a report, your information may be shared with the underwriters of that document.