This here of the Senate Budget committee. The hearing on Government Accountability offices annual report on the nations Fiscal Health. Today the Budget Committee will hear from congress is nonpartisan, watchdog on the nations Fiscal Health and the importance of confronting our critical fiscal challenges. I welcome back mr. Dara who is our most usual and best witness providing information throughout the year that is extremely helpful, hitting off some of the future crises that are going to happen if we dont Pay Attention. This hearing will kick off a series of hearings and discussions that i hope will help inform Bipartisan Solutions to the problems we face this year and help build a foundation for next years budget cycle. And next to you should be significant for the Budget Committee. Committee has been working hard to enact reforms that improve transparency and accountability in the budget process, and helped put us on a more sustainable fiscal path. Last year senator white house and i introduced the bipartisan congressional bubbly format, emphasize or bipartisan and considers the first time any reform bill has gotten out of this committee on a bipartisan way since 1990. We were successful in returning, when we are successful or turning this bill into a law, the next congress would process the first budget cycle covered by its reform. Next year will also mark the first budget cycle in ten years not constrained by the budget control access dictionary spending caps and sequester, in the months ahead we will begin to lay the groundwork for more regular budget during a series of discussions, focused on the major fiscal issues of our countries horizon. With that in mind, we are meeting today for an update on the most pressing threats regarding fiscal stability. Im pleased to welcome back, committee gene l. Dodaro, the comptroller general the United States ahead of the u. S. Government accountability office. Today, they are issuing their Fourth Annual update on the nations Fiscal Health. For several years now, this year has warned that the federal government is on an unsustainable fiscal path. Unfortunately, the budget outlook has grown even more dismal since last years report, thanks to legislative that acted in 2019. Last year, gao predicted that debt as a percentage of Gross Domestic Product which compares the size of our debt to the size of our economy. What surpasses its historical high of 106 by 2038. Now, gao projects that it will hit that grim miles dont by 2034 if current laws dont change. The Congressional Budget Office recent budget outlook, also shows the cost of legislation and acted since last june has taken on our already unsustainable fiscal situation. Due to this legislation, namely, last years spending agreement which cbo attributes one seven tenths million, trillion in spending increases over ten years, the fy 2020 appropriations package that reveals the pay Affordable Care act. Cbo now projects that debt is a pretended of gdp will sort to 174 of gdp by 2049. A 30 inch point increase from last years projection. Cbo warns that feeling to confront our rising debt wont mean a future of slower Economic Growth, higher Interest Rates, and a greater risk of a fiscal crisis. As the deficit grows, we borrow even more money to fund the government, the Interest Payments on the money we borrow it will overtake all other spending. This should be a major red flag for everyone. Already, the annual Interest Payments on our debt exceed what we spend on agriculture, transportation, and Veterans Benefits and services. All combined. By 2041, geo projects our annual Interest Payments will be more than what we spend on medicare. By 2044, Interest Payments will exceed what we spend on Social Security. By 2049, Interest Payments will exceed total Discretionary Spending. We can i do have spared debates on what our Spending Party should be, but Interest Payments on our debt, arent even debatable. We do not get to decide whether we want to spend that money on health care, defense, or retirement security. It is already committed. It is the most mandatory funding that we do. If we stay on the path we are on today, that interest will become the largest category of federal spending. I mention this committee in a vast on a bipartisan vote the budget process reforms and senator white house and i introduced, and you all amended, to make it an even better bill. Our bill take several steps toward a more active, thoughtful, and functional budget process. This includes read orienting the budget resolution to a twoyear cycle. Incorporating the debt limit into the budget process, in a way that would minimize the threat of default. We are also calling for integrating into the budget resolution, longer term fiscal targets, based on National Debt as a percentage of the overall economy. A debt to gdp, glide slope, this would emphasize our fiscal trajectory and help to get us on a more sustainable fiscal path. One thing we will certainly need, as we confront the hard decisions ahead, is reliable, financial, and performance data. Earlier this year, i introduced the cfo vision act with senator warner, grassley, johnson, purdue, and lankford. I expect the general is for this bill as a grew out of a hearing we had with him last october on the cfo act. The reform proposes with standard cfo responsibilities to enhance strategic side dishes and megan strengthened w. Cfo authority to ensure continuity when vacancies occurred. It also calls for revised planning requirements and metrics to help address longstanding challenges. Like better linking cost and performance majors, modernizing outdated like to see systems. I should mention the suggestion we have put in a request to omb to get us a list of all federal programs. Havent got it yet. Seems to be some problem with the definition of what a federal program is. I think i can help with that, if they would just give us a print out. All of the payments that go to any entity, if an entity is getting money from us, it is one of our programs. This is my last year in the senate, it is my sincere hope that we can take concrete steps toward a sustainable fiscal future before i leave. A return to sensible budgeting would be a good start. I hope that members today will Pay Attention to the urgent message from congress is nonpartisan watchdog, our current federal, fiscal situation is unsustainable, and we must act before it is too late. I want to thank comptroller mr. Dodaro for being here again, and again. And for all the delightful information he shares with us. When we follow up on it, we get results. I look forward to his testimony, and i dont think that we have a Ranking Member statement today. I think it might be preparation for a debate that is coming up. So, i dont know if senator grassley wanted to make any comments . Ill ask questions. Okay. We will move on to our witness this morning. As i mentioned is gene l. Dodaro, the head of Government Accountability office and comptroller general of the United States. Mr. Dodaro testifies frequently before congress, and i am pleased to welcome him back to this committee, he is the eighth comptroller general of the United States. He was confirmed in december of 2010 after serving as acting comptroller general since march of 2008. Mr. Dodaro has been with the gao for more than 40 years. He served nine years ofs the chief operating officer of the number two leadership assertion at the agency. Prior to that he had a gaos accounting Information Management division, which specialized in financial management, computer technology, and budget issues. That requires a diverse background of information thats been extremely helpful and has gotten noted every time that you have testified, so with that control to the general you can begin. German sir thank you very much mister chairman, senator grassley senator brown. It is a pleasure to be here today to discuss our latest report on the fiscal help and government. As we convene this discussion today, our country is confronting a pandemic that is threatening the Health Safety and economic wellbeing of our citizens, our businesses and our economy. I make that point because it is relevant to our message today. Why it is important to put the federal government on a more longterm sustainable fiscal path because the federal government needs to have the budgetary flexibility to marshal resources to deal with a myth emergency situations. Im concerned our report talks about that our deputy ratio as of the end of last year or 79 . That is the highest it has been since world war ii when we had the historic high as 160 of debt to gdp ratio. And that also contracts with that to be gdp ratio since 1946 to only 46 so we are very leverage than that at a time when we are going to be facing a steady annual deficits of a trillion dollars a year for as far as the eye can see. This will mean that our death gdp ratio and fiscal policy changes will hit their historic high of over 100 of gdp within 11 to 14 years. And depending on the estimates that are made by gao cbo, the financial reporter, the federal government issued by treasury and omb, they all result in the same conclusion. More importantly than that, is that that that will continue to grow to 200, 300, 400, 500 of gdp. This is why we believe the current path is unsustainable. The Social Security programs is already at one trillion dollars. Medicare and medicaid is expected to hit a trillion dollars each by 2026 which include state money for medicaid. And the interest on the debt will hit a trillion dollars by 2032 so right now, our total federal budget is 4. 5 trillion dollars. Those four programs are active with these alone will be four chilean dollars relatively soon. That will crash out a lot of other opportunities for spending and ranging from the fence to the whole panoply of discretionary programs to the country. So we need a plan, to deal with this. I recognize that we need to deal with short term student prior to National Priorities and make sure we have strong Economic Growth, but we also need a plan to put us on a better path. I was very pleased, mister chairman, to see the bipartisan bill that was passed out in this committee that would set the debt to gdp targets and with also dealing with another trouble scenario that i pointed out in the past setting the debt limit approach it does not control the deck, it is dangerous and the fact that it can disrupt treasury securities if it is not raised in time. Treasury securities marking and increase inches across the four governments we need a different approach. Youre approach that is included in the bill is a good approach. It is one of the options that we suggest of tying into the budget resolution. In addition to this fiscal policy decisions that need to be made there is still many opportunities to save additional money. We have pointed out in our report that this year the amount of improper payments across our government jumped from 151 billion to 175 billion, largely driven by an increase in medicaid an improper payments and i think that number will go up higher but we can talk about that later. There is also opportunity to consolidate overlap, duplication and fragmentation of the federal government. So far actions on recommendations that save 262 billion dollars. We have outstanding recommendations that could save tens of billions of dollars more. There is a lot that can be done to deal with this issue. I, again, and closing, applaud the committee for taking action in this regard. Both on the bipartisan budget, reform bill, as well as the cfo legislation. I would be happy to respond to questions mister chairman. Thank you very much. Thank you, and thank you for the documentary provided with a lot more information than that. I will turn to senator grassley questions. I will take you up on that, and i will go to the agricultural committee. Mr. Durham, your testimony said that Pension Benefit Guaranty Corporation and trust funds protected to be depleted by 2025. I am aware of that and we are working on legislation to try and help that out along with other aspects of multi employer. After 2025, if nothing is done bbcs premiums will not be enough to pay benefits to the and solve it plans and so alexander and i, jurisdiction over some of this we are trying to work on that. There are other proposals as well. I think everyone recognizes the longer we wait the worse the problem becomes. I wonder if you can comment on the need for action to shore up to multi employer Pension System and whether you think that would be prudent to continue to delay action. . Senator grassley, i think it is one of the most urgent issues facing congress. Ive been concerned about the multi employer plan for a number of years. I wrote a special message to congress about this back in 2014. Congress took some action at that time but it was not sufficient enough to deal with the longer term problem if congress does not act there is about 11 Million People that are insured in the Pension Plans and once it goes insolvent the only benefits the government will be able to pay his 2000 dollars a year. If that. To these people, or pension. It is hardly adequate. The government will fail these individuals if it does not act i encourage you to continue your efforts and your colleagues to act on this issue. Also, the Single Employer Program while it isnt a current surplus situation, has tremendous exposure over the long term as well. Said 160 billion dollars of potential losses to that program as well, but the multi employer plan is the most urgent and i want to encourage swift action on part of the congress to address concerns by these americans that would be affected. I want to entitlement series and see cbo and others have been telling us for a long time about Social Security and Health Care Entitlements and our interest issues on the debt that are unsustainable. In order to do that we have to reduce deficits and debt, Social Security will exhaust by 2024 and we will be paying a heck of a lot less Social Security benefits if we do not do something about that. I want to get to health care spending. I have a bill with senator widened to reduce drug braces in save taxpayers money we can allow over all health scare spending subsidies to go faster than the economy grows. If we are serious about reducing our debt, my question to you is dont we have to control the growth in federal spending on health care and entitlements . Absolutely. Congress needs to do that. The Fastest Growing class in the government are health care across and interest on the debt. The Health Care Cost as you point out senator are growing faster than the economy and are projected to continue to do so in the future. There has to be some changes. By 2026 there will only be enough money in the medicare house spittle trust fund to pay 89 cents on the dollar of benefits. That is right around the corner. That would affect millions of americans that rely on the Medicare Hospital Trust Fund cross and put enormous pressure on the federal government. Any suggestions that you make are good ones. We have other open recommendations, and in addition to bringing down drug costs, for example if you if payment on the federal government on medicare, for doctor visits depends on what you go and would place you get. If you go to a Doctors Office that is affiliated with a hospital, medicare pays you more money than if you visited that same doctor in a private practice. If you equalized benefits he would save billions of dollars in that area. We have a number of open recommendations. I will provide them to this committee for the record. I will provide them to your staff as well, but you absolutely have to control Health Care Costs. That is the most complicated part of this whole equation. If you do not control Health Care Costs, you really do not have much of a prayer of reducing the federal governments deficit and debt issues. Thank you for your courtesy. Thank you. We will let you go to the egg meeting from where he just came from judiciary. Senator brown. Thank you mister chairman. Ive been here a little over a year, and probably, the First Committee meeting said vividly stuck in my mind is when you were here roughly a year ago. Of course, who said basically everything than that you are telling us now. I guess what amazes me most about this place is highly seemed to shrug it off like its never going to have impact in the president. Health care costs, undoubtedly, are the driver. I took it on in my own company 15 years ago in there are solutions. Mostly, the reason we are not making any headway on Health Care Costs as i have never seen an industry more doug is, stubborn and wanting to maintain the status quo. When