U.S. Reps. Jim Cooper (TN-5) and Aaron Schock (IL-18) recently introduced the Intergenerational Financial Obligations Reform (INFORM) Act, a bipartisan bill that would require the government to show the long-term consequences of its tax, spending and economic policies.
On Tuesday, more than 1,000 economists -- including 15 Nobel laureates -- endorsed the INFORM Act in a full page ad in The New York Times, which touted Cooper's role. The praise came as The Can Kicks Back, a millennial-led campaign devoted to reducing the national debt, toured the country promoting the bill. The tour included an Oct. 14 stop at Vanderbilt University.
"Today's estimated costs are tomorrow's record deficits," Cooper said. "The INFORM Act gives Congress a reality check on the generational costs of important legislation."
The INFORM Act would require the Congressional Budget Office, Government Accountability Office and Office of Management and Budget to weave fiscal gap and generational accounting into the annual budgeting process. These steps would allow Americans to assess the sustainability of fiscal policy and quantify the obligations facing their children and grandchildren.
The fiscal gap refers to the present value difference between total future projected government spending and revenue, plus our current debt. Generational accounting calculates the net taxes of each living generation and future generations.
Both accounting methods will provide better transparency and show young people how fiscal decisions will impact their pocketbooks over time.
The INFORM Act also would apply to any proposed bill that would impact revenues or spending by greater than 0.25 percent of gross domestic product.