CEPR Deficit Calculator Deflates IOUSA Scare Story

For Immediate Release

Center for Economic and Policy Research (CEPR)
Contact: 

Alan Barber (202) 293-5380 x115

CEPR Deficit Calculator Deflates IOUSA Scare Story

WASHINGTON - Many viewers and reviewers of the film
IOUSA wrongly believe that the United States faces a devastating budget
crisis if it continues on its current path. In reality, the scare story
is driven almost entirely by projections of exploding private sector
health care costs. The growth of private sector costs will have a
devastating impact on the budget because close to half of the country's
health care expenses are paid by the government through public sector
programs like Medicare and Medicaid. 

A new online calculator released today by the Center for Economic and Policy Research (CEPR) is designed to make this fact clear. The IOUSA Deficit Calculator
uses per person health care costs in other nations to clearly show that
U.S. health care costs are the main culprit behind our projected budget
deficit woes.

The
calculator presents the budget deficit as a percentage of GDP over the
next 70 years, with the baseline projection from the Congressional
Budget Office (CBO), which plays the starring role in the IOUSA movie.
The calculator then allows you to compare this baseline projection with
deficit projections that are adjusted to assume that the United States
has the same per person health care costs as any of more than 20 other
countries, all of which enjoy longer life expectancies (in parentheses
next to each country) than the United States. Users can simply check as
many countries as they like in order to see what the U.S. budget
deficit would be if the United States had the same per person health
care costs as these countries.

"While
there are serious economic issues the nation needs to be concerned
about, the views presented in IOUSA are misleading and one-sided." said
Dean Baker,
Co-Director of CEPR. "Few viewers of the film will recognize the fact
that ballooning health care costs are at the heart of our budget
problem, not Social Security or demographics more generally."

For further analysis of the misleading assertions found in IOUSA, please visit www.iousanotok.org or IOUSA Not Ok on the CEPR website.

 

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