CBO: Though Now At A Low Point, Deficit Projected To Rise As More Baby Boomers Enroll In Medicare, Social Security
The Congressional Budget Office forecasts that the red ink will start flowing again in 2017, and by 2025, deficits could again top $1 trillion.
The Wall Street Journal:
CBO: Deficit To Narrow, Then Widen In ’18
The CBO’s report showed that discretionary spending, after excluding interest costs and major safety-net programs such as Medicare and Social Security, is set to fall by 2019 to its lowest level as a share of the overall economy since comparable data reporting began in 1940. ... Monday’s report also revised down by 7% from its last forecast, released in August, the projected costs to the government from the Affordable Care Act that Mr. Obama signed into law five years ago. Health-insurance spending for the 2015-19 period is now 20% lower than when the CBO issued its first estimates for the law in March 2010. (Timiraos, 1/26)
The New York Times:
Budget Forecast Sees End To Sharp Deficit Declines
The federal budget deficit will continue to inch downward through next year, but even with the economy on an upward trajectory, the government’s red ink will begin to rise in 2017 and expand with an aging population, the Congressional Budget Office said Monday. The new budget projections effectively signal the end of the steep decline in deficits as the economy climbed out of the recession. Lawmakers now face a familiar and politically vexing problem: What to do about increases in Medicare, Medicaid and Social Security spending that reflect the nation’s demographics, not its economic health? (Weisman, 1/26)
The Associated Press:
CBO: Deficit To Shrink To Lowest Level Of Obama Presidency
For future years however, CBO issued a warning: Beyond 2018, deficits will start rising again as more baby boomers retire and enroll in Social Security and Medicare. By 2025, annual budget deficits could once again top $1 trillion, unless Congress acts. At that point, Social Security benefits would account for one-quarter of all federal spending, said CBO Director Douglas Elmendorf. "The underlying point is that we have a handful of very large federal programs that provide benefits to older Americans," Elmendorf said. "And with the rising number of older Americans and a rising cost of health care, those programs get much more expensive." (1/26)
McClatchy:
Federal Debt Will Explode Over Next 10 Years, CBO Says
The federal debt is set to explode over the next decade even as the budget deficit is projected to reach its lowest level of the Obama presidency, the Congressional Budget Office said Monday. (Hall, 1/26)
USA Today:
Federal Deficit Falling To Lowest In Obama Presidency
CBO also projects the unemployment rate will fall further -- to 5.3% by 2017 -- as more people are encouraged to enter or stay in the workforce. The budget agency estimates that the number of U.S. residents without health insurance will drop from 42 million last year to 36 million this year, largely because the Affordable Care Act. ... While the deficit is projected to hold steady through 2018, CBO projects the gap between spending and revenues will continue to grow due to the retirement of Baby Boomers and healthcare costs associated with an aging population, as well as rising interest rates on the federal debt. (Davis, 1/26)
The CBO also forecasts that the health law's cost could be as much as 20 percent less over the next decade than previously projected -
The New York Times:
Budget Office Slashes Estimated Cost Of Health Coverage
The Congressional Budget Office on Monday significantly lowered its estimate of the cost of providing health insurance coverage to millions of Americans under the Affordable Care Act. Douglas W. Elmendorf, the director of the budget office, said the changes resulted from many factors, including a general “slowdown in the growth of health care costs” and lower projections of insurance premiums that are subsidized by the federal government. (Pear, 1/26)
Los Angeles Times:
Obamacare Cost To Be 20% Less Than Forecast, Budget Office Says
President Obama's healthcare law will cost about 20% less over the next decade than originally projected, the Congressional Budget Office reported Monday, in part because lower-than-expected healthcare inflation has led to smaller premiums. So far, the number of uninsured Americans has dropped by about 12 million. By the end of 2016, 24 million fewer Americans will lack insurance, the nonpartisan budget office forecast. Excluding immigrants in the country illegally, who are not eligible for coverage under the law, only about 8% of Americans under age 65 will lack insurance by the time Obama leaves office, the budget office's latest report on the law estimates. (Lauter, 1/26)
Reuters:
Obamacare's Insurance Subsidies May Cost Less
Obamacare will cost 7 percent less than expected over the next decade for federal subsidies to help lower-income people pay for private health insurance, congressional researchers said Monday. A report by the nonpartisan Congressional Budget Office (CBO) said insurance coverage would cost $964 billion from 2015 to 2024, $68 billion below its April 2014 projection, because of factors including lower-than-expected enrollment in federal and state insurance exchanges set up under the Affordable Care Act. (1/26)
The Washington Post's Wonkblog:
CBO: Interest On Federal Debt Will Triple Over Coming Decade
Meanwhile, the CBO said that the cost of the Affordable Care Act continued to come in substantially below the March 2010 estimates. Because the program gets more expensive over time, the 10-year cost estimates have risen. But costs compared year by year remain lower. In March 2010, the CBO and Joint Committee on Taxation projected that the ACA would cost the federal government $710 billion during fiscal years 2015 through 2019. The newest projects put the cost at just $571 million over those years, about 20 percent lower than the original estimates, the CBO said in its report. The latest projections for the cost in 2019 are $132 billion, or 23 percent less than the original projection. (Mufson, 1/26)