We’re all in favor of good news, but take with caution some happy projections about the U.S. budget.
A Congressional Budget Office report on the deficit has fed some of the amnesia about the crisis in the rising federal debt. The CBO is required to project the deficit by relying on current law, even if just about everyone knows that those laws either will be changed or waived. For example, strict spending limits on Medicare expenditures are frequently waived, because the cuts are thought to be too tough.
When the CBO forecasts a deficit on more realistic assumptions, the deficit picture in the coming years does not look as rosy.
The future need not be bleak, but the nation cannot afford deficit-amnesia, even if there is good news in a deficit down to a projected $642 billion for fiscal year 2013. Don’t forget: that’s still a lot.