Here is my latest revised projection of deficits. I don't show it here, but it crosses the 150% of GDP line in 2038. The main change is that revenue is reduced. The revenue numbers come from the CBO, and the adjustment comes from the CRFB, consisting of tax cut extensions and continued AMT patches. I wish that revenue would be as high as the CBO projects, but I just don't see it.
Medicare and Medicaid spending seem to have slowed recently, so the projections seen here may be too high. For instance Medicare, FYTD is only $176 billion, making an annualized amount $422 billion, much lower than the $560 billion projected here. I think my numbers came from the Medicare projections. Anyways this is good news but I would like to see if the trend continues before adjusting my projected spending.
So maybe my projections are a little too bleak. Still, I want to see "facts on the ground" before producing my positive projections, and with February's deficit at an all time high, I am not seeing them, except for slightly reduced Medicare and Medicaid spending.
Update: I am looking at the official budget for defense spending and it shows defense spending of $688 billion in 2012 and $673 billion in 2013. So these numbers need to be adjusted.
Update April 6: I did a revised projection based on lower Medicare and Medicaid numbers and the situation looks a little better - deficit of only 1321 in 2012 instead of 1473 - but still I don't see the deficit ever dropping below 1 trillion/year. And the endpoint is still in 2038.