The Government Accountability Office has long had a statutory responsibility for monitoring the condition of the nation’s finances. Recently, in our role as the auditor of the U.S. government’s consolidated financial statements, we included an emphasis paragraph in our audit report for the fiscal year ended September 30, 2004 expressing our concerns that the fiscal policies in place today will—absent unprecedented changes in tax and/or spending policies—result in large, escalating, and persistent deficits that are economically unsustainable over the long term. This conclusion is based on the results of GAO’s long-term budget model, which the agency has used since 1992.The GAO believes that there has to be a reevaluation of government programs and the underlying assumptions and budgetary decision-making process. The fiscal reality is that if the budget and the appropriations process stay the same, there is disaster down the road. If budget growth keeps pace with inflation, given the current budget, and the tax cuts are made permanent, in 40 years the government will only have the discretionary spending to cover the interest on the federal debt. Even with the end of tax cuts, the current budget is unsustainable.
A few other interesting quotes:
"Many current federal programs and policies, in fact, were designed decades ago to respond to trends and challenges that existed at the time of their creation. Given our recent entry into a new century, we have been reminded of how much has changed in the past several decades—whether it be rapid shifts in the security threats facing the nation, the aging of our population, the globalization of economic transactions, escalating health care costs, increased environmental concerns, or the significant advances in technologies and transportation systems. Moreover, given the fiscal constraints we are likely to face for many years to come, such a reexamination may very well be essential to address newly emergent needs without unduly and unfairly burdening future generations of taxpayers."
"…the magnitude of funding and potential for current investments and operations to turn into long-term financial commitments are prompting real questions about the affordability and sustainability of the rate of growth in defense spending."
"Higher education is increasingly global in nature as students study outside their country of origin with greater frequency and universities have become multinational institutions. While the United States has long been the global leader in higher education—and the most desired destination of foreign students seeking higher education—recent graduate enrollments have fallen, and institutions in other countries have captured an increasing share of the international student population."