Magazine article Brookings Review

Election 1996: The Choices Ahead

Magazine article Brookings Review

Election 1996: The Choices Ahead

Article excerpt

The budget deficit and the economy have become key issues in the presidential campaign and will top the agenda of the next Congress and president. The nation's recent economic record may make this focus seem out of place. The budget deficit, measured as a percent of GDP, has declined for four straight years. It is now one-third what it was in 1992 and lower than it's been in 17 years. The economy, with unemployment well below 6 percent, has been operating at close to full capacity for the better part of two years. Consumer price inflation has been below 3 percent for over four years, the best record since the early 1960s.

But the reasons for the economic focus are understandable. Leaders in both political parties have committed to balancing the budget by 2002. The challenge is considerable because the built-in spending growth of current programs, primarily Medicare and Medicaid, will cause the deficit to begin to grow again in 1997. Policymakers have forsworn a repetition of the tax increases that contributed almost ball the deficit reduction delivered by the 1990 and 1993 legislative packages. In fact, they've promised substantial tax cuts. Thus the already big spending cuts needed to balance the budget will have to be even deeper.

Where will the cuts be made? Most of the 1990s spending cuts came from the defense budget, a move made widely acceptable by the end of the Cold War. But a fierce debate has begun over how big a role defense should play in further deficit reduction. Already, the budget requirements of the planned force structure exceed the resources provided in administration and congressional budget plans. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.