Summary of US Federal budget trend?

  • Deficit narrowing nicely in recent years as recession has ended, so tax receipts up
  • But deficit will start growing again at end 2015 due to ageing population (baby boomers entering retirement, hence Medicare, Medicaid and Social Security expenditure will rise).
  • So expected rising deficit over the next 10 years will be a function of demographics and not economic slowdown.
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