Our updated analysis explains that policymakers could stabilize the public debt as a share of the economy over the coming decade by enacting $1.5 trillion more in deficit reduction, beyond the savings that the 2011 Budget Control Act, the “fiscal cliff” tax deal, and other legislation will achieve (see chart).
Here’s the opening:
Policymakers could stabilize the public debt over the coming decade with $1.5 trillion in additional deficit savings, according to the Center’s updated calculations, which are based on the new budget projections that the Congressional Budget Office released February 5. Policymakers could achieve these savings with $1.3 trillion in policy savings (that is, spending cuts and tax increases), which would generate about $200 billion in savings in interest payments. The $1.5 trillion in total savings would stabilize the debt at 73 percent of gross domestic product over the latter part of the decade.