Have Recent Budget Policies Contributed to Long-Run Fiscal Stability?

Research Report

Have Recent Budget Policies Contributed to Long-Run Fiscal Stability?

Abstract

The United States is on a disastrous fiscal path. In the conflict between restoring solvency and stimulating the economy, the president's budget is more focused on the latter. Yet even before the recession Medicare and Medicaid, along with Social Security, accounted for almost 50 percent of noninterest spending. Payouts have risen rapidly since, and these entitlements are growing faster than the economy and tax revenues. Whether the 2010 health reform and other recent budget balancing measures have helped stabilize the deficit is explored in this report.

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