Reducing the Deficit: Spending and Revenue Options. A Report to the Senate and House Committees on the Budget - Part II
Abstract
The Congressional Budget Office (CBO) projects that, under current budgetary policies, the federal budget deficit will be $155 billion in fiscal year 1989 and $141 billion in 1990. Thereafter, the projected deficit declines by only about $5 billion per year, and is still $129 billion in 1993. Under the targets mandated by the Balanced Budget and Emergency Deficit Control Reaffirmation Act of 1987 (Public Law 100-119), the deficit target is $100 billion in 1990, $64 billion in 1991, $28 billion in 1992, and declines to zero in 1993. Thus, despite sustained legislative efforts in recent years, the gap between the deficit under current policies and the legislated budget targets is formidable. Moreover, because of the need to spur lagging national saving and investment, many people argue that a budget surplus is needed in the longer run. During the 1980s, the federal government has run up large deficits, unprecedented in peacetime since the depression of the 1930s. The federal debt has increased from 26.6 percent of the gross national product (GNP) at the beginning of the decade to 42.9 percent in 1988. This fiscal policy has contributed to declines in net national saving for the 1980s and to large trade deficits with their associated accumulation of foreign debt.
Document Details
- Document Type
- Technical Report
- Publication Date
- Feb 01, 1989
- Accession Number
- ADA531063
Entities
People
- Earl Armbrust
- Elliot Schwartz
- George Iden
- John D. Mayer
- Jon Hakken
- Roger Hitchner
- Wilhelmina A. Leigh
Organizations
- Congressional Budget Office