Research Report The Real Fiscal Danger
William G. Gale, Peter Orszag
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The Bush Administration's budget includes a chapter entitled "The Real Fiscal Danger," which highlights the projected imbalances in Social Security and Medicare. Ironically, the budget does not include any specific steps to eliminate or even reduce those imbalances. It does, however, propose substantial tax cuts that exacerbate the longterm budget deficits it so vividly displays. Especially since the tax cuts divert revenue that could have instead been used to grease the wheels of Social Security or Medicare reforms, the Administration's attitude that tax cuts are the solution to every social and economic problem is itself a significant contributor to the real fiscal danger. This is the second in a series of columns that addresses this budget strategy.
Research Areas Economic mobility and inequality Taxes and budgets
Tags Fiscal policy Individual taxes Federal budget and economy