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Why Long-Term Debt Matters Now

WHY LONG-TERM DEBT MATTERS NOW Despite policy changes and slowing health care costs, federal debt is still projected to climb to unsustainable levels. Healthcare is the major driver of the projected federal spending growth over the long term. DEBT HELD BY THE PUBLIC FEDERAL SPENDING 2043 202% Percentage of GDP 200 Percentage of GDP 10 Actual Projected Actual Projected 150 WWII 100 50 2- After ATRA and Slower Health Cost Growth 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 1973 1983 1993 2003 2013 2023 2033 2043 2050 O MAJOR HEALTH PROGRAMS • SOCIAL SECURITY O DEFENSE DISCRETIONARY • NONDEFENSE DISCRETIONARY • OTHER MANDATORY PUBLICLY HELD DEBT PROJECTED TO RISE ABOVE 202% of GDP 2043 200% GDP, THE ENTIRE ANNUAL U.S. ECONOMIC OUTPUT 75% OF GDP of GDP 2013 BY 2029 DEBT WOULD BE AT HIGHEST LEVEL SINCE WWII PEAK OVER NEXT 3 DECADES, DEBT WILL I Millions MEDICARE ENROLLMENT 120- SOARS BABY BOOMER RETIREMENT 100 The number of 80 people receiving Social Security 60 benefits will swell 40 from 58 million today to 95 million in 2043. 20 AS BABY BOOMERS TURN G65 1980 2000 2020 2040 2060 2080 WITHOUT ACTION $1.1 IN JUST 13 YEARS, SOCIAL SECURITY BENEFITS 7% GAP WILL NEED TO BE CUT BY AN AVERAGE OF 23% ANNUALLY BETWEEN FEDERAL SPENDING AND GDP 23% Medicare's trust fund is expected to run out of money and the Social Security trust fund will be exhausted by 2033. BY 2026 TOTALING TRILLION IN 2033 BY 2040, INTEREST COSTS ON THE DEBT ARE S PROJECTED TO BE MORE THAN 3X WHAT THE FEDERAL GOVERNMENT HAS HISTORICALLY SPENT ON EDUCATION, R&D, AND INFRASTRUCTURE COMBINED Percentage of GDP GROWING INTEREST COSTS Percentage of GDP 35 12.4 30 Interest Costs 25 8.6 20 2.7 Revenue 15 5.4 10 R&D 1.4 INFRASTRUCTURE EDUCATION 2010 2020 2030 2040 2050 2060 2070 2080 2012 2030 2040 2050 (1963 - 2013) Average Spending By 2064, federal revenues will not even be sufficient to cover interest payments on the federal debt. Interest Costs Read the whole story at pgpf.org/whydebtmatters Peter G. Peterson Foundation Our America. Our Future.

Why Long-Term Debt Matters Now

shared by PGPF on Jul 31
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America's growing national debt in historical perspective and how it can impact future generations.

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Politics
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