Elderly populations mean more government spending

At the peak of concerns over public debt and deficits in 2010, President Barack Obama created a bipartisan commission charged with putting American fiscal policy on a sound footing. Crucial to this was containing growing spending on health care and pensions as America’s population aged. By 2020 the resultant “Simpson-Bowles” plan aimed to bring America’s debt-to-gdp ratio down to about 66%. Gloomy officials at the Congressional Budget Office (cbo) wrote up an “alternative fiscal scenario” that showed a “clear threat” of a fiscal crisis if corrective actions were not taken. In it, the debt would rise to 95% of gdp in 2022.