Dan Mitchell of the Cato Institute argues that it wouldn’t be that hard for the federal government to achieve a balanced budget.
So if the Republicans who now control Washington are serious about protecting the interests of taxpayers, it should be relatively simple for them to adopt good fiscal policy.
And if GOPers actually decide to do the right thing, the grim numbers in the CBO’s new report quickly turn positive.
- If spending is frozen at 2017 levels, there’s a budget surplus by 2021.
- If spending is allowed to grow 1 percent annually, there’s a budget surplus by 2022.
- If spending is allowed to grow 2 percent annually, there’s a budget surplus by 2025.
- If spending is allowed to grow 2.63 percent annually, the budget is balanced in 10 years.
- With 2.63 percent spending growth, the burden of government spending drops to 18.4 percent of GDP by 2027.
To put all these numbers in context, inflation is supposed to average about 2 percent annually over the next decade.