With the non-partisan Congressional Budget Office releasing its updated Budget Outlook on Wednesday, the debt limit discussions led by Vice President Joe Biden were forced to a halt, as Democrats’ arguments that taxes could close the budget deficit were unequivocally muted. House Majority Leader Eric Cantor and Senate Minority Whip John Kyl were forced to pull out of the debt limit discussions when Democrats refused to get serious about the government’s spending crisis. Democrats proved unwilling to focus on the trillions in savings needed to pull the government back from collapse; instead Democrats are willing to let the country default rather than admit their spending addiction needs to be cured.
Democrats’ fixation on taxes reveals a serial misunderstanding of the country’s current fiscal health. CBO confirmed yesterday the country cannot tax its way out of its financial mess. The structural deficiencies of overblown discretionary spending, coupled with looming entitlement insolvency, set the United States on the road to disaster within the next ten years. According to the report:
- The United States debt will total 100 percent of Gross Domestic Product (GDP) by 2021
- Major entitlement spending on health care and social security, along with interest payments, will overtake revenues by 2024
- Interest payments on the debt will increase by 536 percent over the next twenty five years, from 1.4 percent of GDP in 2011 to 8.9 percent of GDP by 2035
“Finally, Democrats are getting honest about their plan for the country’s financial future, which is to hide behind tax hikes rather than fix the spending problem they created,” said Americans for Tax Reform President Grover Norquist. “Lawmakers who want to hike taxes, rather than save the country from bankruptcy, have been excused from the table. It’s time for grown-ups to sit down and start addressing the country’s spending problem head on.”