Social Security and Medicare will take up ever-larger shares of GDP in coming decades, the nonpartisan Congressional Budget Office indicated today in a report.
“The aging of the population and the rising cost of health care would cause spending on the major mandatory healthcare programs and Social Security to grow from roughly 10 percent of GDP today to about 15 percent of GDP 25 years from now,” the report said; total federal spending, excluding payments on the debt, has averaged 18.5% over the past few decades.
This will no doubt increase pressure on the debt talks Vice President Biden is privately holding with Majority Leader Eric Cantor (R-Va.) and other members of Congress.
The news comes as the Democrats’ top budget hawk, Finance Committee Chairman Senator Kent Conrad, has joined Republicans in holding the country hostage by refusing to support raising the debt ceiling without massive spending cuts. Failing to increase the government’s ability to borrow would be catastrophic, according to economists, budget analysts, and the business community.
Conrad, for his part, says the $2 trillion in cuts reportedly being considered by Biden’s group isn’t enough and that “serious” budget watchers know something more like $4 trillion is needed.
Whether those cuts will come by putting cherished social programs like Social Security on the chopping block, or by reducing the comically large defense budget (I leave it to readers to venture a guess) is the big question here.
Even Republican Speaker John Boehner has acknowledged the necessity of raising the debt ceiling.