The document discusses the current U.S. economic outlook and its implications. It notes that expected future income is flat, wealth is down, and uncertainty is up. It argues that unsustainable government spending undermines economic stability by reducing the permanence of rewards and increasing future tax liability. In particular, rising entitlement spending is a major source of this problem. It suggests that reforms are needed to cut the growth rate of spending and entitlements in order to birth a new era of economic freedom.

1. The U.S. Economic
Outlook:
What It Means For You
By
Jim Granato

3. • Voluntary Cooperation/Mutual Exchange
• Creative Destruction
• Property Rights/Rule of Law
• Price Mechanism
• Free Trade
• Public Expectations

5. Source: Taylor, Economcs One.

6. Source: Taylor, Economcs One.

9. • Expected future income is flat.
• Wealth is down.
• Uncertainty is up.
Policy can help … but it must
focus on “permanence in
rewards” and “permanence in
reducing future tax liability.”

10. Problem:
Unsustainable government spending
undermines permanence in reward
Structure and increases future tax
liability.

11. Source: Taylor, Economcs One.

12. Problem Source:
Entitlement Spending is a major
source of the problem.

15. Source: Taylor, Economcs One.

16. Source: Taylor, Economcs One.

17. Source: Taylor, Economcs One.

18. Source: Taylor, Economcs One.

20. Spending Reform:
• Cut the rate of growth in
spending.
• Entitlements and the 50%
“problem.”
• Roadmap “suggestions.”

21. Source: CBO.

22. Tax Reform:
• Rates v. Rebates
• Tax expenditures
• Bowles-Simpson Proposals

25. • A new birth of economic freedom is
needed.
• This will take greater advantage of the
fundamental drivers.
• But, it will require that people pay more
for themselves when it comes to
entitlement spending and government
“spending” in general.
• We are the reason this situation exists.