Fiscal Outlook: Grim
What is truly disappointing for those of us who are interested in fiscal restraint is the fourth line under Implicit Exposures. Medicare Part D is Bushes baby all the way, the Medicare Drug Benefit for Seniors. And yes, it is estimated to cost almost $9 Trillion dollars. In other words, just this program alone accounts for about one third of the increase of the fiscal exposure this country is facing. It is also the single largest component of the increased fiscal exposure as well.
But how does all of this translate into fiscal burden? Well the GAO report gives us that information as well,
I can’t think of much to say other than, look at those numbers. And if you think Bush’s notion of making the tax cuts permanent will solve the problem via higher growth rates, you are in for a very nasty wake up call in decade or two down the road. Faster economic growth, while it will help, cannot solve this problem. The GAO report notes that for growth to solve this problem we’d need economic growth in the double digits for every year for the next 75 years. And given the spotty record of tax cuts spurring economic growth, the idea of making the tax cuts permanent is just nonsense.
The bottom line is that when Bush talks about fiscal restraint he is simply not being honest.