Where We Stand: America’s Fiscal State and the Road To a Full Recovery

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WHERE WE STAND: AMERICA’S FISCAL STATE AND THE ROAD TO A FULL RECOVERY

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Where We Stand: America’s Fiscal State and the Road To a Full Recovery. TOTAL SPENDING FY 2013 = $3.55 TRILLION. Discretionary Spending. Autopilot Spending. TOTAL RECEIPTS 2013 (in Billions). FEDERAL SPENDING VS. SEQUESTRATION. SEQUESTRATION VS. PRESIDENT’S TAX HIKES. - PowerPoint PPT Presentation

Transcript of Where We Stand: America’s Fiscal State and the Road To a Full Recovery

Page 1: Where We Stand: America’s Fiscal State and the Road To a Full Recovery

WHERE WE STAND:AMERICA’S FISCAL STATE AND THE

ROAD TO A FULL RECOVERY

Page 2: Where We Stand: America’s Fiscal State and the Road To a Full Recovery

Medicare$502

Med-icaid$265

Social Secu-rity

$810

Interest$224

Other Manda

tory$538

Non De-

fense Discre-tionary$582

De-fense$631

Source: CBO

DISCRETIONARY SPENDING

AUTOPILOT SPENDING

TOTAL SPENDING FY 2013 = $3.55 TRILLION

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Individual Income$1,264

Corporate Income $251

Social Insur-ance$953

Other$241

Source: CBOTOTAL = $2.7

TRILLION

TOTAL RECEIPTS 2013 (in Billions)

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FEDERAL SPENDING VS. SEQUESTRATION

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SEQUESTRATION VS. PRESIDENT’S TAX HIKES

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10%

15%

20%

25%

30%

35%

40%

Historic & Projected Spending

President's Tax Increases

Historic & Projected Tax Revenue

Source: OMB/CBO/HBC

Historic/Projected Spending & Revenue as a Percentage of GDP

#SPENDINGISTHEPROB-LEM

SPENDING IS THE PROBLEM

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WHERE IS OUR MONEY GOING?(GOVERNMENT SPENDING AS A SHARE OF ECONOMY)

0%

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25%

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Medicaid & Other HealthMedicare

Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare Medicare

REV-ENUE

SOURCE: CBO

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8201220132014201520162017201820192020202120222023$0

$200

$400

$600

$800

$1,000

$1,200

PRESIDENT’S BUDGET

HOUSE BUDGET

CBO CUR-RENT LAW

PROJECTED DEFICIT PATHS(IN BILLIONS OF DOLLARS)

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HEALTH CARE COSTS ARE THE PRIMARY DRIVER OF THE DEBT

(GOVERNMENT SPENDING AS A SHARE OF ECONOMY)

20112013

20152017

20192021

20232025

20272029

20312033

20352037

20392041

20432045

20472049

20510%

2%

4%

6%

8%

10%

12%

14%

SOURCE: CBO

HEALTH CARE SPEND-ING

SOCIAL SECU-RITY

DISCRETIONARY SPENDING

OTHER MANDATORY PROGRAMS

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Spain Portugal Ireland Italy Greece United States%

20%

40%

60%

80%

100%

120%

140%

160%

180%

64%

91%

114%120%

152%

100%

TROUBLE AHEAD - EUROPE(GOVERNMENT DEBT AS A SHARE OF ECONOMY )

SOURCE: IMF

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HOUSE PLAN FOR FULL RECOVERY

The Path To Prosperity

Efficient, Effective and Responsible Government

Strengthening the Social Safety Net

Fulfilling the Mission of Health and Retirement Security for All Americans

Pro-Growth Tax Reform

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TOTAL GOVERNMENT SPENDING (AS A SHARE OF ECONOMY)

19681971

19741977

19801983

19861989

19921995

19982001

20042007

20102013

20162019

20222025

20282031

20342037

20402043

20462049

%

10%

20%

30%

40%

50%

HISTORICAL

CURRENT PATH

PATH TO PROSPERITY

SOURCE: OMB/CBO

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A CHOICE OF TWO FUTURES(DEBT AS A SHARE OF ECONOMY)

1940 1948 1956 1964 1972 1980 1988 1996 2004 2012 2020 2028 2036 2044 2052 2060 2068 2076%

100%

200%

300%

400%

500%

600%

700%

800%

900%

CURRENT PATH

SOURCE: OMB/CBO

PATH TO PROSPER-

ITY

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WHAT IS NEXT?

President’s budget deadline: February 4

Sequester cuts hit: March 1

“Continuing resolution” expires: March 27

Budget deadline for House and Senate: April

15

Debt limit reached: May 19

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FOUR YEARS LATER

Source: House Ways and Means Committee

January 2009 January 2013

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OUR NATIONAL DEBT

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REFERENCE MATERIALS

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TAX REVENUES DO NOT CORRELATE WELL WITH TAX RATES

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TAX REVENUES ARE HIGHLY CORRELATED WITH GDP

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bottom 20% second middle fourth top 20% top 1%$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

SOURCE: IRS/TAX POLICY CENTER

WHO BENEFITS FROM TAX LOOPHOLESAVERAGE PER PERSON BENEFIT BY CATEGORY OF EARNERS

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WHO BEARS THE TAX BURDEN?(SHARE OF INCOME TAX BURDEN)

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WHO OWNS OUR DEBT?(DEBT HELD BY PUBLIC, 1970 -2011)

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Lowest Individual Rate Middle Individual Rate Top/Corporate Tax Rate0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

10%

25%

35%

19%

47%

66%

25%

63%

88%

200820502081

SOURCE: CBO

CHASING HIGHER SPENDING WITH TAXES(INCREASE IN TAX RATES NECESSARY TO KEEP PACE SPENDING)

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BCA = SEQUESTER ATRA = FISCAL CLIFF BILL

HOW THE FISCAL CLIFF AND SEQUESTER AFFECTS OUR DEBT

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TOTAL SPENDING IN FY 2010 = $3.5 TRILLION(OUTLAYS IN BILLIONS OF DOLLARS)

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$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

SPENDING SPREE CONTINUES(IN BILLIONS OF DOLLARS)

SOURCE: OMB OBAMA FY2013 BUD-GET