Douglas Elmendorf, the universally-respected budget analyst at the helm of the non-partisan Congressional Budget Office, gave a guest lecture to an intro economics course at Harvard University.
Called “A Tour of the Federal Budget and Possible Changes in Budget Policy,” it’s an outstanding crash course in the changes the federal budget is undergoing.
The role of government has been shifting subtly for years, and Elmendorf more than many others has been able to perceive this change. Less government money is spent on contracts and employees, while more is given directly to people and states.
The final conclusion is guaranteed to make you wince.
Elmendorf is the Director of the Congressional Budget Office, which is tasked with analysing the fiscal impact of new legislation.
As a result, Elemendorf might be the most plugged-in non-partisan person when it comes to budgetary issues.
The federal government is rather basic when it comes down to it. Spending can be broken into a few key blocks.
Taxes, too have generally decreased or stayed the same. Look at how volatile the top rate has been, though.
The current trajectory trends toward the government spending more on Social Security and Medicare than other things.
Looking at what is set to decrease and what is set to increase paints a fascinating picture of the changing face of government.
Lots of people rely on the federal government in one way or another. It's not all about the bottom line.
But at the end of the day, it's going to take either tax increases or cuts to middle-class government benefits in order to fix the debt.
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