We should shortly be getting the CBO’s latest budget outlook, which includes the effects of the Trump tax cut. To prepare ourselves, here’s the projection from last year’s long-term budget outlook:
Over the next 30 years, net spending increases from 19.3 percent of GDP to 23.2 percent. That’s about one percentage point per decade, mostly due to rising health care costs. In other words, it’s not a lot. What’s more, if technological advances slow down health care spending—something I find likely even if it seems hard to believe right now—spending won’t go up even that much.
But if you add interest on the national debt, spending goes up nearly 9 percentage points. That’s the killer, and there’s no technological advance that can change this. In the 2018 version of the CBO report, this will get even worse thanks to last year’s tax bill.
Despite what conservatives say endlessly, spending is not the problem. We can easily manage an increase of 1 percent per decade for the next few decades. It’s only if we refuse to pay for it that the national debt explodes.
