Both parties have a plan for the debt: Do nothing

The Congressional Budget Office last week released its annual budget and economic outlook report, and although the news was gruesome, the report was greeted in Washington with a giant yawn. The assumption among Republicans and Democrats is that the political rewards for curbing runaway budget deficits are too meager to justify the risks. There’s a consensus to do nothing — and to hope that nothing goes disastrously wrong.

Just how large are impending deficits? Here are the CBO projections.

From 2019 to 2028, the federal government will run cumulative annual deficits of $12.4 trillion. The deficits — the gap between what government spends and what it collects in taxes — average about 5 percent of the economy (gross domestic product, or GDP). Since 1950, deficits have equaled or exceeded 5 percent of GDP in only six years (1983, 1985 and 2009-2012), and most of these occurred after deep recessions. These reduce tax revenue and boost “safety net” spending (unemployment insurance, food stamps and the like).

By contrast, today’s deficits occur with low unemployment and an economy that has been expanding for nine years.