In coming decades, the aging of the population, rising health care costs, and the expansion of federal subsidies for health insurance will put increasing pressure on the federal budget. At the same time, by 2020, if current laws generally remained in place, federal spending apart from that for Social Security and major health care programs would drop to its smallest percentage of total output in more than 70 years, and federal revenues would be a larger percentage of output than they have been, on average, during the past 40 years.1 Still, the rising cost of Social Security and the major health care programs would lead to widening deficits, the Congressional Budget Office (CBO) projects. Under those projections, federal debt held by the public would rise substantially over the long term as a share of the economy's annual output- from 72 percent of output now to more than 100 percent of output 25 years from now-which would probably have significant negative consequences for the economy and reduce lawmakers' ability to respond to unexpected developments.