Bill's Boomers George's Grandkids

January 20, 1993

The Bush administration cannot be allowed to go off into the wild blue yonder without a glimpse at what it foresees fiscally in the wild blue yonder. It is not a pretty picture either for Bill Clinton's baby boomers or for George Bush's grandchildren.

Deep within the budget book issued in these latter days by Richard Darman, chief of the book-cooking department in the Bush White House, are projections of what the federal deficit may look like in the year 2030 and beyond. We would advise all readers daring to go on to fasten their seat belts.

If one takes budget director Darman's mid-growth projections at face value, the federal debt held by the public rises from 56.1 percent of gross domestic product in 1995 to 134.1 percent in 2030 if there is no cap on entitlement programs. This is due to only a marginal increase in revenues from 18.7 percent of GDP to 19.1 percent while outlays leap from 22.5 percent to 31.2 percent. The expenditure explosion is primarily caused by the ballooning of Social Security, Medicare and Medicaid benefits plus steadily rising interest costs. So-called discretionary programs -- anything from defense to highways -- are assumed to hold constant.

By way of understatement, Mr. Darman describes this scenario as "an unsustainable course that will have to be corrected." As the deficit begins to rise with the arrival of the new century and continues going up to 2030 and beyond, he predicts "increasing strain" on the Social Security system as the population ages and the work-force becomes a steadily smaller fraction of the total.

For those seeking assurance that fiscal doomsday will never come, Mr. Darman also has a high-growth scenario with entitlements capped that would get rid of the deficit by 1999. But that is simply pie in the sky. The Committee for a Responsible Federal Budget has found that Mr. Darman's figures just for the fiscal 1994 and 1995 years immediately ahead have been designed to "make the deficit look better than it is."

Actually, the deficit outlook is considerably worse that it was officially described in mid-campaign and yet even more appalling than Mr. Darman is now willing to admit.

President Clinton faces a budget crisis after he takes office today that dwarfs anything ever seen before. It is the legacy of Reagan-Bush borrow-and-spend tactics in which the Democratic Congress acquiesced. The new administration will soon have to tell the country what it proposes to do about this overwhelming problem. It may be the most important document of the next four years, one that will have a large bearing on how Bill Clinton's contemporaries fare in their golden years when they will be supported by George Bush's grandchildren.

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