National Debt Cited as Major Financial Risk
Date: 7/29/2010
The Congressional Budget is working to remind policymakers and taxpayers of the financial hazards the ever-increasing national debt can bring.

Presently, the national debt is rapidly approaching the $14 trillion mark, fueled by two consecutive years of federal budget deficits exceeding $1 trillion.

In a report this week, the CBO cited factors like an aging population and rising healthcare costs as factors that will continue to inflate the national debt in the coming years, barring some significant policy changes.

"Unless policymakers restrain the growth of spending, increase revenues significantly as a share of gross domestic product, or adopt some combination of those two approaches, growing budget deficits will cause debt to rise to unsupportable levels," warns the CBO, which also cites the higher possibility of a "sudden fiscal crisis" because of the debt.

One major consequence of an unchecked national debt in the coming years may be higher tax rates that could further discourage people from working and saving. The soaring national debt is also seen as potentially undermining investor confidence while also contributing to inflation by forcing the government to print more money to make ends meet.