Feb 05 2015
Washington – Sen. Ron Johnson questioned the director of the Office of Management and Budget (OMB), Shaun Donovan, on Tuesday, Feb. 3 during a Senate Budget Committee hearing about the president’s fiscal year 2016 budget proposal.
Sen. Johnson’s questions focused on the value of economic growth. Donovan agreed with the senator that economic growth is a major component in solving the federal government’s budget problems. “From 2009 to last fiscal year,” Sen. Johnson then asked, “can you also confirm, we’ve actually increased revenue of the federal government by 916 billion dollars per year?”
Donovan replied, “I don’t have that number in front of me.”
Sen. Johnson brought the director up to speed: “It went from 2.1 trillion to 3 trillion dollars — over 900 billion dollars — 874 billion of that is just due to meager economic growth, only 42 billion was attributed to that fiscal cliff tax deal,” the senator said.
Sen. Johnson pointed out to Donovan that, based on the realistic projection from the nonpartisan Congressional Budget Office, federal spending will exceed federal revenue by about $126 trillion over the next 30 years. The biggest categories of federal spending will be Social Security, which will spend about $15 trillion more than it raises from the payroll tax, and Medicare, which will spend about $35 trillion more. Besides these, the government will spend about $71 trillion in interest paid on its accumulating debt.
“My question to you,” Sen. Johnson asked Donovan, “in your budget deliberations, are you looking at the 30-year problem? And if you are, what has the president included in his budget to address the long-term unsustainability of both Social Security and Medicare? Because those are what drives the debts, which does produce 71 trillion dollars of interest payments.”
Donovan cited changes that could cause health care spending to rise by $400 billion less than otherwise projected by 2025, and to rise by $1 trillion less than otherwise projected over the next 20 years.
“You’re talking about a trillion,” replied Sen. Johnson, “and we are looking at 126 trillion.”
Watch the senator’s full exchange with Donovan in the video below.