What We Owe The Future

The Recommendations of the Millennial Debt Commission

II Revenues

The growth of the national debt has been fueled primarily by rising government spending, but righting the ship necessitates a more complex set of solutions: cutting spending, growing the American economy, and yes, increasing revenue. Over the past 50 years, federal revenues have averaged 17.3% of GDP. In 2021, federal revenues amounted to $4.0 trillion or 18.1% of GDP, significantly higher than historical averages. The Congressional Budget Office (CBO) projects a gradual growth in revenues to 19.1% of GDP by 2052. The plan presented here would further increase revenues to 19.9% of GDP by 2052.

III Spending Savings

Over the past 50 years federal spending has averaged 20.8% of GDP. In 2021, federal spending surged to $6.8 trillion driven by a series of spending packages to address the COVID pandemic and stimulate the economy. With COVID spending gradually coming to an end, CBO projects spending will fall from 30.5% of GDP in 2021 to 22.2% of GDP in FY 2024 and then begin a steady, and growing, increase relative to the economy, driven by growth in entitlement and net interest spending. By 2052, CBO projects federal spending will equal 30.2% of GDP.

VI In Conclusion

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