If America does not change course, the future will be dramatically worse. Now more than ever, it is crucial that Americans understand what our nation’s spending, taxes, and debt mean for them and their families. The Heritage Foundation’s Federal Budget in Pictures offers a unique tool to learn about the federal budget in a clear and compelling way. The Heritage Foundation’s Federal Budget in Pictures offers a unique tool to learn about the federal budget in a clear and compelling way.
Excessive spending is creating record levels of debt—and the worst is yet to come, threatening opportunity and prosperity for younger generations.
As Washington continues spending well beyond its means, it is burdening Americans with increasing levels of debt. Congress must cut spending to fix the debt.
If a median-income family spent and borrowed like the federal government does, it would spend $61,000 despite earning only $52,000. It would pile $9,000 on top of an already massive debt of more than $311,000—like having a mortgage, only without the house.
Publicly Held Debt Set to Skyrocket
Runaway spending, especially on Medicare, Medicaid, and Social Security, will drive federal debt to unsustainable levels. Total national debt includes publicly held debt—or debt borrowed in credit markets—and debt that one part of the government owes to another. Including intragovernmental debt, the national debt already exceeds the size of the nation’s economic product (GDP).
Federal Budget Deficits Will Reach Record Peacetime Levels
Without reforms, growing spending—especially for Medicare, Medicaid, Social Security, and other mandatory programs—will drive deficits to catastrophic levels. Congress should cut spending and put the entitlements on a sustainable budget.
All Tax Revenue Will Go Toward Health Care, Social Security, and Net Interest by 2031
In less than two decades, all projected tax revenues would go toward only health care (Medicare and Medicaid, including CHIP and Obamacare), Social Security, and interest on the debt. Entitlement reform is a must.
Social Security Deficits: Permanent and Growing
Social Security began running cash-flow deficits in 2010, paying out $51 billion more in benefits than the program received in payroll taxes that year. Without reforms, Social Security’s cash-flow deficits will rise rapidly and will quadruple in less than 20 years, when its combined trust fund would be exhausted.
Social Security Deficits: Permanent and Growing
Social Security began running cash-flow deficits in 2010, paying out $51 billion more in benefits than the program received in payroll taxes that year. Without reforms, Social Security’s cash-flow deficits will rise rapidly and will quadruple in less than 20 years, when its combined trust fund would be exhausted.
Congress Should Cut Spending Before It Considers Raising the Debt Limit
Congress has raised the debt limit too many times without making substantive budget reforms to curb the growth of the debt. In recent years, Congress has suspended the debt limit altogether, most recently through March 15, 2015. When the debt limit is reinstated, it will exceed $18 trillion. Congress should adopt budget reforms that fix spending and debt instead of growing the debt without limits.
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