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The Government Accountability Office recently issued an update in a series of reports detailing the fiscal position of state and local governments.
The President’s budget for Fiscal Year 2012 contains spending and revenue proposals for the remainder of the current year, as well as the coming decade.
Chairman Paul Ryan's budget aims to shrink the size of government to about 20 percent of gross domestic product (GDP) in 2015 and to 15 percent of GDP in 2050.
Relative to the GAO’s last update of their long-term simulation, the nation’s fiscal condition has deteriorated.
These projections provide fresh evidence that the nation’s fiscal policy is on an unsustainable course and changes in policy will be needed.
According to the Joint Committee on Taxation, the provisions in this agreement will add $374.2 billion to the deficit in 2011, and $857.8 billion to the deficit by 2020.
While proposals to raise the retirement age are intended to improve the financial health of the Social Security program, GAO finds that such changes could produce an opposite result, while also having an adverse impact on some of society’s most vulnerable members.
Under the GAO’s most realistic fiscal scenario, debt held by the public will exceed 109 percent of GDP by 2020.
The rapid growth in health care costs is the largest and fastest growing fiscal challenge.