NEW YORK — Michael A. Peterson, President and CEO of the Peter G. Peterson Foundation, will testify before the U.S. Senate Committee on the Budget on Wednesday, October 21, 2015. At the hearing, entitled “Reforming the Federal Budget Process: The Need for Action,” Peterson will discuss the ways in which improving our budget process could help lawmakers address America’s long-term fiscal challenges.

“Unfortunately, shortcomings in the budget process can stand in the way of solutions to our nation’s long-term fiscal challenges,” Peterson said. “America’s long-term debt threatens economic growth and opportunity. As Congress prepares to address a series of upcoming fiscal decisions and deadlines, there is no better time to consider giving policymakers better tools through an improved budget process.”

Peterson highlighted three key areas of budget reform that would help lawmakers focus on long-term fiscal solutions:

• Adding a long-term focus. Extending the current 10-year “budget window” that Congress generally uses during the budget process to 25 years, which would increase the visibility of our long-term fiscal future.
• Setting targets. Requiring Congress and the president to set medium- and long-term fiscal goals, and then report on progress annually, would improve accountability and transparency on our fiscal condition.
• Strengthening enforcement. Adding new or strengthening existing enforcement measures would help policymakers’ stay on the path towards their budget targets. These reforms would have to be flexible enough to accommodate changing conditions, but strong enough to establish and reinforce the commitment to long-term fiscal sustainability.

The nonpartisan Congressional Budget Office (CBO) projects that within 25 years, debt held by the public could climb to more than 100 percent of GDP under current law and to 175 percent of GDP under less optimistic assumptions. As debt continues to accumulate and interest rates increase, CBO projects that under current law interest costs will total more than $5 trillion over the next ten years. Under CBO’s alternative fiscal scenario, interest costs will become the third largest category of the budget in 2023, the second largest category in 2032, and the single largest category by 2040.

“If our long-term fiscal challenges are not addressed, our future economy will suffer, with fewer economic opportunities for individuals and families,” Peterson added. “Putting our nation on a sustainable fiscal path is essential to ensuring economic growth and prosperity for the next generation.”

The hearing will be livestreamed by the Senate Budget Committee on their website.

Click here for Michael A. Peterson’s full testimony.

More information is available at the Senate Budget Committee’s hearing page.

About the Peter G. Peterson Foundation
The Peter G. Peterson Foundation is a nonprofit, nonpartisan organization that is dedicated to increasing public awareness of the nature and urgency of key fiscal challenges threatening America’s future, and to accelerating action on them. To address these challenges successfully, we work to bring Americans together to find and implement sensible, long-term solutions that transcend age, party lines and ideological divides in order to achieve real results. To learn more, please visit www.pgpf.org.