Under such a long-term outlook, a temporary period of accumulating federal surpluses
constitutes a double-edged sword: It presents an opportunity for implementing fiscal reforms but also creates the risk that lawmakers will assume additional spending commitments, worsening the already ominous long-term budget picture.
do not always buy new plants and equipment; they could finance housing, consumer debt, or the next Internet start-up.
"I believe we need to make hard choices about how to spend any federal surpluses
. To a large extent, we have mortgaged the future of our children.
The overall surplus is more than accounted for by the Old Age, Survivors, and Disability Insurance surplus, which is already used to finance future social security benefits, so there is double-counting in using these federal surpluses
again for retirement programs, whether to finance individual accounts or to finance future social security spending.
That loomed as a possibility not long ago when federal surpluses
opened the possibility of using use tax dollars to maintain public lands.
One might ask an awkward question: If fiscal surpluses produce such benefits, why are market interest rates rising again now, when federal surpluses
are also surging?