This is the Cato Daily Podcast for Friday, February 3rd, 2012.

I'm Caleb Brown.

The Congressional Budget Office regularly gives budget projections,

and they see trillion dollar deficits for a long time to come.

The problem with that estimate, according to Chris Edwards, Director of Tax Policy

Studies at the Cato Institute, is that's the best case scenario.

Well the CBO's annual budget projections show federal spending and revenue out 10 years.

The bad news is that the federal deficit again

tops a trillion dollars this year. The CBO says that the deficit will be

1.1 trillion dollars this year and if someone just looks at the headline numbers in CBO it shows

that the federal deficit falls pretty dramatically to just 200 billion

dollars a few years from now. The bad news is that everyone knows that that probably isn't true and

the CBO knows that their baseline projection has a lot of unrealistic

assumptions built into it.

So the CBO provides us an alternative fiscal scenario and under that more realistic

alternative scenario the federal deficit continues on at over a trillion dollars

a year for the next decade.

So under a more realistic view of the federal budget with no reforms, we will have another 10 trillion added to the deficit to the federal debt over the next decade.

So under the baseline, the sort of dueling baselines here you have you have two ideas of what's going to happen

what encompasses the alternative baseline well under the CBO baseline that they are

required to show by law all the current tax cuts expire.

Various items on the spending side look better than they really are.

...