Why revenues must rise

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Loren Adler and Shai Akabas explain why revenues must rise:

Even if the 2001, 2003, and 2010 tax cuts are extended … revenues are projected to rise from 16.1 percent of GDP in 2012 to 18.0 percent in 2017, and then remain roughly at that level for the remainder of the decade. This approximates the average U.S. revenue level in the modern era. In times of better fiscal health, such receipts might have been sufficient, but the coming decades do not fit the bill.

First, our public debt is already at 72 percent of GDP – higher than it has been in over half a century – and projected to increase further. Second, a wave of baby boomers are beginning to descend on the entitlement programs, and supporting them in retirement will require additional spending even if significant reforms are made to control costs. Between these two trends, we will not be able to collect revenues at “normal” levels if we want to have a sustainable budget and a functioning economy.

Peter Schorsch is the President of Extensive Enterprises and is the publisher of some of Florida’s most influential new media websites, including SaintPetersBlog.com, FloridaPolitics.com, ContextFlorida.com, and Sunburn, the morning read of what’s hot in Florida politics. SaintPetersBlog has for three years running been ranked by the Washington Post as the best state-based blog in Florida. In addition to his publishing efforts, Peter is a political consultant to several of the state’s largest governmental affairs and public relations firms. Peter lives in St. Petersburg with his wife, Michelle, and their daughter, Ella.