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We have been at a crossroads like this before. Unfortunately, in prior showdowns, we haven’t fully taken advantage of the opportunity. 2011’s debt limit fight led to fiscal reforms in the Budget Control Act, but it failed to address the fundamental drivers of our long-term debt, and therefore did not have a meaningful impact on our long-term fiscal outlook.
CBO recently warned that the national debt is near an all-time high and will grow to unsustainable levels. Under current law, the federal debt is approximately 73% of GDP. CBO projects that debt will climb to 100% of GDP within 25 years, and under less optimistic assumptions, that our debt will reach a staggering 190% of GDP during that same timeframe. Such levels of debt would be dangerous and simply unsustainable.
Rather than continuing to engage in brinksmanship that contributes to greater uncertainty, and results in poor policy, it’s time to get our fiscal house in order once and for all. Congress and the President should work immediately to seek a comprehensive bipartisan framework to protect the economic recovery and stabilize our debt for the long term.