CED Fiscal Health Policy Issue Page Debt Reduction Toolkit
Last Update: May 2024
Instructions
This toolkit permits users to generate different scenarios to achieve a 70 percent ratio of debt to GDP by adjusting the tax rate and outlay costs. The toolkit accompanies CED's Solutions Brief entitled Debt Matters: A Road Map for Reducing the Outsized US Debt Burden, published on February 9, 2023, which recommended a shift to a 70 percent ratio as a recognized stable level for advanced economies that is roughly in between the current ratio and the ratio before the 2008 financial crisis.
The blue line, which does not change, is based on the Congressional Budget Office's (CBO) long-term budget projections from March 2024. By selecting a value from 0 to 100 as inputs for the values percentage cut to all outlays and percentage permanent increase in all tax rates and hitting the "Generate Charts" button, the toolkit will generate seven charts of various financial measures comparing the chosen scenario both to CBO's March 2024 base case and to the suggested 70 percent debt-to-GDP ratio, held constant.