CBO: Stimulus almost doubled U.S. debt
A new report from the Congressional Budget Office (CBO) finds that President Obama’s economic stimulus program helped nearly double U.S. debt.
The 2011 Long-Term Budget Outlook, released Wednesday morning, reports that the “the combination of automatic budgetary responses” and Obama’s stimulus “had a profound impact on the federal budget.” According to CBO projections, before Obama’s stimulus became law, federal debt equaled 36 percent of GDP and was projected to decline slightly over the next few years. Instead, thanks in large part to the stimulus, debt reached 62 percent of GDP by 2010.
Other lowlights from the report include:
·Debt will reach 70 percent of GDP by the end of this year – the highest percentage since World War II.
·Spending on Medicare, Medicaid, and Social Security will reach 15 percent of GDP by 2035 – spending on all government programs has averaged 18.5 percent over the past 40 years.
·Total government spending is set to hit 27 percent of GDP by 2035.
·Taxes are sight to grow from 19 percent of GDP in 2013 to 23 percent by 2035.
·Americans “at various points on the income scale would pay a larger percentage of their income in taxes than people at the same points do today.”
·The effective marginal tax rate on labor income would rise from about 25 percent now to about 35 percent in 2035.
