Bush Tax Cuts, Wars Major Drivers of Projected Government Debt

http://economistsview.typepad.com/economistsview/2011/05/bush-tax-cuts-wars-major-drivers-of-projected-government-debt.html

referenced the following:

http://www.offthechartsblog.org/what%E2%80%99s-driving-projected-debt/

As we’ve noted, my colleagues Kathy Ruffing and Jim Horney have updated CBPP’s analysis showing that the economic downturn, President Bush’s tax cuts, and the wars in Afghanistan and Iraq explain virtually the entire federal budget deficit over the next ten years. So, what about the public debt, which is basically the sum of annual budget deficits, minus annual surpluses, over the nation’s entire history?

The complementary chart, below, shows that the Bush-era tax cuts and the Iraq and Afghanistan wars — including their associated interest costs — account for almost half of the projected public debt in 2019 (measured as a share of the economy) if we continue current policies.

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As Kathy and Jim note, simply letting the Bush tax cuts expire on schedule (or paying for any portions that policymakers decide to extend) would stabilize the debt-to-GDP ratio for the next decade.

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