United States’ Federal Indebtedness and Fiscal Policy Trade-Offs
The above is the title of a recent Penn-Wharton Budget Model working paper available here:
https://budgetmodel.wharton.upenn.ed...4/4/19/w2024-1
https://static1.squarespace.com/stat...BM_W2024-1.pdf
Here's the abstract:
We estimate federal spending and taxes by birth-year, gender, race, and education, by interacting official budget totals with microsimulation demographics to project federal budget imbalances. Future federal spending exceeds tax receipts under current policy. The federal Fiscal Imbalance totals $162.6 Trillion in present value, six-fold larger than outstanding debt held by the public.
Restoring fiscal balance would require immediately and permanently either raising all federal taxes by 26.1 percent or reducing all federal spending by 33.4 percent, or some combination of the two. Holding harmless some population groups from changes, including people over age 59, increases the required adjustment rate.
Problems such as this with numbers that large seem intractable - doing little things seems to have almost no impact on such giant numbers, so the tendency is to do nothing at all.
It has all the hallmarks of a movie that won't end well.
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