APRIL 17, 2013
Obama budget reveals economy never gets back to normal growth
FAIRFAX, Va. — Americans for Limited Government President Bill Wilson today issued the following statement on the Obama budget's economic expectations:
"The economic assumptions in the 2014 Obama budget are simply devastating. If true, nominal economic growth will never again reach its postwar historical 6.5 percent average rate of increase. Instead, it will only grow an average 4.8 percent a year this decade. This will have negative implications on the nation's financial picture for a generation.
"The Obama economic team has already been proven wrong about everything. In 2009, it overestimated GDP by a whopping $1.046 trillion in its first term. It overstated revenues by $1.1 trillion. But for sequestration and the Federal Reserve's quantitative easing and low interest rate bailouts, the debt would be much larger today.
"Yet, despite those bailouts, in 2013, the national debt will grow by 7.5 percent — above its 7 percent historical growth rate. If sequestration over the coming decade is cancelled and/or if inflation strikes, forcing interest rates to spike, and if the low growth assumptions going forward prove correct, by 2042, debt to GDP could rise to be as high as 189 percent, if not higher.
"Until the economy starts growing faster than the debt, we are skidding down a slippery slope to certain insolvency."
