Please Take the Threat of a Fiscal Breakdown Seriously
Projections aren’t firm predictions, but ignoring them is still a mistake.
Best pay attention.
Photographer: Chip Somodevilla/Getty Images
The latest projections from the Congressional Budget Office repeat a warning made many times before: The trajectory of US government borrowing is unsustainable. Washington, fixated on this year’s elections, isn’t merely unwilling to act; it’s ignoring the issue altogether. Just how concerned should the country be about this dereliction of duty?
Like all economic forecasts, fiscal projections are usually wrong, and the fiscal crunch that the CBO warns is coming might never happen. Equally, what lies ahead could be even scarier. A reckoning of the chances of better or worse outcomes is therefore valuable. Analysts have undertaken such an exercise for Bloomberg’s Big Take, and the conclusion isn’t reassuring.