The Hard Road to Fiscal Responsibility

The paper describes the current U. S. fiscal problems showing that without significant changes in revenue and spending policies, the country is headed for a sovereign debt crisis similar to that afflicting countries in Southern Europe. Various options for stabilizing the debt-GDP ratio are analyzed including the proposals of the President's National Commission on Fiscal Responsibility and Reform and the Bipartisan Policy Center's Deficit Reduction Task Force. The budgets passed by the House of Representatives and the president's response are also considered. The paper goes on to describe the Budget Control Act passed after the debt limit debate of 2011.