I revised my model again after looking at the President's proposed budget. It is very troubling.
First, it is unconnected to reality. 2011 net interest costs were 266, not 230. The 266 number comes from the Treasury. It is projecting that interest costs will decrease in 2012 to 223. So the President's budget guys don't have a clue as to how much interest costs will be. Second, it is based on wishful thinking. They project that Medicare costs will decrease in 2012. They project that revenue will vastly increase. It could happen. But for now I am sticking with my previous revenue numbers.
One area I do trust it is when they project a large increasing in discretionary spending in 2012. So I will take that into account. But then it projects that this spending will be cut by about 200 in 2013.
So without further ado, here is my revised projection based in very small part on the latest budget. It projects (not shown here) that the 150% mark will be hit in 2032. I will likely revise this again when the CRFB weighs in.
Update: I just noticed that these numbers are almost exactly the same as a projection I made almost two years ago.
Update 6/19/2012: This is model K-2.