Americans are watching with a growing sense of dread as our nation's debt levels continue to spiral out of control. In just 15 short years, we've gone from budget surpluses to more than $15 trillion of debt. What's worse, the federal government doesn't show any signs of righting the ship.
Today, the federal government spends 76 percent of the federal budget on just four things: Medicare, Medicaid, Social Security and interest on the national debt. Absent serious efforts on the part of Congress, those costs are set to climb to 92 percent of the federal budget by the year 2020.1
This huge increase will be fueled in large part by the exodus of our nation's 78 million baby boomers out of the work force and on to the rolls of our entitlement programs. In order to offset these costs, tax rates would have to rise dramatically.2 In fact, David Walker, a former federal comptroller general, has calculated that taxes would have to double immediately in order to sustain our ever-increasing debt load.3
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