Financial Statements of the United States Government for the Fiscal Years Ended September 30, 2017, and 2016

Statements of Long-Term Fiscal Projections

The Statements of Long-Term Fiscal Projections are intended to assist readers of the Government’s financial statements in assessing the financial condition of the federal government and how the Government’s financial condition has changed (improved or deteriorated) during the year and may change in the future. They are also intended to assist readers in assessing whether future budgetary resources of the Government will likely be sufficient to sustain public services and to meet obligations as they come due, assuming that current policy for Federal Government public services and taxation is continued without change.

The Statements of Long-Term Fiscal Projections display the present value of 75-year projections by major category of the Federal Government’s receipts and non-interest spending. These projections show the extent to which future receipts of the Government exceed or fall short of the Government’s non-interest spending. The projections are presented both in terms of present value dollars and in terms of present value dollars as a percent of present value Gross Domestic Product (GDP). The projections are on the basis of policies currently in place and are neither forecasts nor predictions. These projections are consistent with the projections for Social Security and Medicare presented in the Statements of Social Insurance and are based on the same economic and demographic assumptions as underlie the Statements of Social Insurance. These statements also display the fiscal gap, which is a summary measure of the combination of non-interest spending reductions and receipt increases necessary to hold the ratio of debt held by the public to GDP at the end of the projection period to its value at the beginning of the period. Note 23—Long-Term Fiscal Projections, further explains the methods used to prepare these projections and provides additional information. Unaudited required supplementary information further assesses the sustainability of current fiscal policy and provides results based on alternative assumptions to those used in the basic statement.

As discussed further in Note 23, a sustainable policy is one where the ratio of debt held by the public to GDP (the debt-to-GDP ratio) is stable or declining over the long term. GDP measures the size of the Nation’s economy in terms of the total value of all final goods and services that are produced in a year. Considering financial results relative to GDP is a useful indicator of the economy’s capacity to sustain the Government’s many programs.

United States Government
Statements of Long-Term Fiscal Projections (Note 23) Present Value of 75 Year Projections as of September 30, 2017 and 2016¹

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¹ 75-year present value projections for 2017 are as of 9/30/2017 for the period FY 2018-2092; projections for 2016 are as of 9/30/2016 for the period FY 2017-2091.

² The 75-year present value of nominal Gross Domestic Product (GDP), which drives the calculations above is $1,347.0 trillion starting in FY 2018, and was $1,302.8 trillion starting in FY 2017.

³ Represents portions of Medicare supported by payroll taxes.

⁴ Represents portions of Medicare supported by general revenues. Consistent with the President's Budget, outlays for Parts B & D are presented net of premiums.

⁵ To prevent the debt-to-GDP ratio from rising over the next 75 years, a combination of non-interest spending reductions and receipts increases that amounts to 2.0 percent of GDP on average is needed (1.6 percent of GDP on average in 2016). See Financial Statement Note 23.

Totals may not equal the sum of components due to rounding.

The accompanying notes are an integral part of these financial statements.