Discretionary spending is projected to go well below historical levels under current law
January 01, 2012
SOURCE: Data from the Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2013 to 2023, February 2013. Compiled by PGPF.
Under current law, discretionary spending is projected to change dramatically. These trends result largely from the Budget Control Act of 2011 (BCA), which was designed to achieve $2.1 trillion in deficit reduction. If Congress allows the automatic spending cuts in the BCA to go into effect at the end of 2012, CBO projects that discretionary spending will fall from 8.4 percent of GDP in 2012 to 5.6 percent of GDP by 2022--the lowest level in 50 years. Such low future discretionary spending to levels may not be sustainable politically. More fundamentally, the BCA did not address the main driver of long-term structural deficits. The U.S. cannot solve its long-term budget challenges through cuts to discretionary spending alone. Lasting, bipartisan reform will require rethinking entitlement spending and revenue policies.
This chart appeared as a part of PGPF's analysis of the January 2012 report by the Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2012 to 2022. To read the full report, click here.
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