Thursday, March 24, 2011

5 Reasons Why the Federal Budget Is Doomed

Sorry kids, but the Baby Boom generation is about to suck you dry and create havoc for the federal budget. According to a new Government Accountability Office report, boomers are to blame for two of the five upcoming fiscal disasters crashing into the federal budget as they dip into Social Security and Medicare.

"Rising healthcare costs and the aging of the U.S. population have already begun to affect the federal budget, and their effect is expected to increase in coming decades as more members of the baby boom generation continue to retire and more people become eligible for federal health programs," says the new report.

What's more, says the grim GAO report, if the president and Congress don't move swiftly to begin making spending and taxing changes now, the crisis will get much worse. "Policy makers could develop a plan in the short term that could be phased in over time to allow for the economy to fully recover and for people to adjust to the changes. However, with the passage of time, the window to develop and implement such a plan narrows," says GAO.