Federal debt held by the public is expected to reach 96 percent of GDP in 10 years. But if we adopted The Heritage Foundation’s
new budget plan, the federal budget would be balanced by 2024 and $11.9 trillion would be cut from federal deficits over the next 10 years. From Justin Bogie and Romina Boccia, here are some details on the proposed spending reforms:
Currently, the Congressional Budget Office projects federal spending to grow at a rate of 5.5 percent each year. The Heritage blueprint would reduce that rate to 3.1 percent.
Total federal spending under the plan would fall $12.4 trillion lower than Congressional Budget Office estimates over the next 10 years. By 2024, debt as a share of the economy would begin to shrink, and in 2028 would be nearly 23 percent lower than what the Congressional Budget Office projects. [...]
Spending on the three big entitlements—Social Security, Medicare, and Medicaid—is growing unchecked on autopilot. By 2028, spending on these programs will claim over 73 percent of all federal revenues. These programs are simply unsustainable in their current form.
They also come with a heavy price tag for future generations. Tens of trillions in unfunded obligations threaten younger Americans with massive tax increases down the road and a growing pile of debt. The Medicare trustees estimate that by 2026, Medicare will be insolvent. The Social Security Trust Fund will likewise be depleted by 2034.
This blueprint would make a series of decisive reforms: repeal Obamacare; modernize Medicare by transitioning to a premium-support system and making key reforms to meet demographic, fiscal, and structural challenges; cap federal contributions to Medicaid and give states greater flexibility in designing benefits and administering the program; give states more responsibility in running welfare programs; and make critical reforms to Social Security to ensure seniors are protected from poverty in retirement while accounting for increased life expectancy and reducing the growth in benefits.
[Justin Bogie and Romina Boccia, “These 5 Changes Would Fix the Nation’s Budget Woes,” The Daily Signal, June 14]
