and Medicare Prescription Drug Coverage 
under part D of title XVIII of the Social 
Security Act; 
‘‘(vi) direct spending and expenditures 
described in clause (v) and all other direct 
spending including the supplemental nutri-
tion assistance program, supplemental se-
curity income benefits, child, earned in-
come, and other tax credits, child nutrition 
programs, the temporary assistance for 
needy families program, housing assistance 
programs, and civilian and military retire-
ment programs; and 
‘‘(vii) discretionary appropriations and 
direct spending, except interest payments 
on outstanding Treasury liabilities. 
‘‘(D) DYNAMIC EFFECTS.—Calculations of 
fiscal gap policy options shall incorporate dy-
namic effects from induced changes in labor 
supply, national saving, and capital formation, 
as relevant to each particular policy option 
among those described in subparagraphs (C). 
‘‘(8) FISCAL GAP REPORT.— 
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‘‘(A) IN GENERAL.—The term ‘fiscal gap 
report’ means a report that, in accordance with 
this paragraph— 
‘‘(i) specifies the amount of explicit 
debt, the implicit debt, and the fiscal gap; 
‘‘(ii) provides fiscal gap policy options; 
and 
‘‘(iii) incorporates a fiscal gap sensi-
tivity analysis. 
‘‘(B) SEPARATE
REPORTING
FOR
TRUST 
FUNDS.— 
‘‘(i) IN GENERAL.—A fiscal gap re-
port shall address each item specified in 
clauses (i), (ii), and (iii) of subparagraph 
(A) separately for each social insurance 
program. 
‘‘(ii) FISCAL GAP POLICY OPTIONS.— 
The fiscal gap policy options provided for 
each Federal social insurance program 
shall be limited to changes in receipts and 
expenditures from the applicable trust 
fund. 
‘‘(iii) CALCULATION.— 
‘‘(I) IN GENERAL.—For purposes 
of calculations relating to the fiscal 
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gap in connection with a social insur-
ance program, the calculations shall 
be determined as the sum of— 
‘‘(aa) the projected budget- 
year-end value of Treasury secu-
rities and other assets held in the 
applicable trust fund; and 
‘‘(bb) the present discounted 
value of annual expenditures 
from the applicable trust fund 
over future fiscal years minus the 
present discounted value of re-
ceipts paid into the applicable 
trust fund excluding transfers 
from other Federal funds over 
future fiscal years. 
‘‘(II) EXPENDITURES
AND
RE-
CEIPTS.—For purposes of subclause 
(I), expenditures and receipts shall in-
clude expenditures and receipts pro-
jected through the future fiscal year 
described in paragraph (15)(B). 
‘‘(iv) LIMITING.—For each social in-
surance program, a fiscal gap report shall 
separately address each item specified in 
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clauses (i), (ii), and (iii) of subparagraph 
(A) as specified and after limiting the cal-
culation under clause (iii)(I)(bb) to the 
closed group of past and current adult pro-
gram participants (as described in para-
graph 11(B)(i)), both taxpayers and bene-
ficiaries. 
‘‘(C) SCENARIOS.—A fiscal gap report 
shall address each item specified in clauses (i), 
(ii), and (iii) of subparagraph (A) under— 
‘‘(i) a baseline estimate; and 
‘‘(ii) an alternative scenario estimate. 
‘‘(D) AMOUNTS.—A fiscal gap report shall 
provide information with respect to each item 
specified in clauses (i), (ii), and (iii) of subpara-
graph (A)— 
‘‘(i) in present-discounted dollars; 
‘‘(ii) as percentages of present-dis-
counted value of future gross domestic 
product projected through the future fiscal 
year described in paragraph (15)(B); and 
‘‘(iii) as a percentage of the amount 
of taxes projected to be collected under 
sections 1401(b), 3101(b), and 3111(b) of 
the Internal Revenue Code of 1986 
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through the future fiscal year described in 
paragraph (15)(B). 
‘‘(9) FISCAL GAP SENSITIVITY ANALYSIS.— 
‘‘(A) IN GENERAL.—The term ‘fiscal gap 
sensitivity analysis’ means estimates of changes 
to the fiscal gap amounts specified in para-
graph (8)(D) calculated under alternative eco-
nomic and demographic assumptions for a given 
scenario described in paragraph (8)(C). 
‘‘(B) REQUIRED ALTERNATIVES.—The al-
ternative economic assumptions for any fiscal 
gap sensitivity analysis shall include the fol-
lowing: 
‘‘(i) Projected annual rate of popu-
lation growth that is 25 basis points larger 
and 25 basis points smaller than the base-
line population growth-rate projection spec-
ified under paragraph (15)(C). In making 
the estimates, the applicable agency may 
use reasonable alternative symmetric basis 
point variations around baseline popu-
lation-growth projections consistent with 
uncertainty associated with underlying 
growth components of fertility, mortality, 
and immigration rates. 
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‘‘(ii) Projected annual rates of labor 
productivity growth that is 50 basis points 
larger and 50 basis points smaller than the 
baseline labor productivity growth-rate pro-
jection specified under paragraph (15)(C). 
In making the estimates, the applicable 
agency may use reasonable alternative, 
symmetric basis-point variations around 
baseline labor-productivity growth rates 
consistent with uncertainty associated with 
underlying components of inflation rates, 
technological change, capital intensity, and 
labor efficiency. 
‘‘(iii) Projected discount rates that are 
75 basis points larger and 75 basis points 
smaller than the baseline long-term dis-
count rate projection specified under para-
graph (15)(D). In making the estimates, 
the applicable agency may use reasonable 
alternative, symmetric basis-point vari-
ations as appropriate around baseline in-
terest rate projections consistent with un-
certainty associated with long-term govern-
ment borrowing rates. All interest rate 
variations reported shall be consistent with 
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maintaining a net positive average long- 
term interest rate after subtracting the 
long-term 
average 
labor 
productivity 
growth rate of the economy of the United 
States. 
‘‘(10) GENERATION.—The term ‘generation’ 
means a 1-year birth cohort of individuals of a given 
gender born during a given fiscal year. 
‘‘(11) GENERATIONAL ACCOUNT.— 
‘‘(A) 
IN
GENERAL.—The 
term 
‘generational account’ means the actuarially 
present-valued amount per capita for a given 
generation of annual net Federal tax burdens 
during that generation’s remaining lifetime 
under a particular Federal fiscal policy. 
‘‘(B) 
AGES.—A 
report 
regarding 
generational accounts shall include generational 
accounts for— 
‘‘(i) selected individual generations 
born not less than 18 years before the re-
port; and 
‘‘(ii) selected individual generations 
born or who will be born after the date 
that is 18 years before the report, includ-
ing those born after the budget year. 
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‘‘(C) 
CALCULATION.—Generational 
ac-
counts of children and future generations de-
scribed in subparagraph (B)(ii) shall be cal-
culated such that— 
‘‘(i) their total over all members 
equals the sum of— 
‘‘(I) Treasury liabilities projected 
to be outstanding at the end of the 
budget year; and 
‘‘(II) the present value of pro-
jected 
discretionary 
(non-transfer) 
Federal spending minus the sum of 
the generational accounts of adult 
generations described in subparagraph 
(B)(i); 
‘‘(ii) the ratio of the generational ac-
count of males of each generation among 
children and future generations described 
in subparagraph (B)(ii) to the generational 
account of females born in the same year 
is set equal to the ratio of the generational 
accounts of males and females born 18 
years before the calculation; and 
‘‘(iii) the generational accounts of 
members of children and future genera-
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tions described in subparagraph (B)(ii) in-
creases with the year of their births at the 
projected growth rate of labor productivity. 
‘‘(12) GENERATIONAL
ACCOUNT
POLICY
EF-
FECTS.— 
‘‘(A) 
IN
GENERAL.—The 
term 
‘generational account policy effects’ means the 
changes to the generational accounts of adults 
described in paragraph (11)(B)(i) and children 
and future generations described in paragraph 
(10)(B)(ii) and to the generational net-tax-bur-
den gap from changes to particular (combina-
tions of) Federal taxes and to particular (com-
binations of) Federal expenditures. 
‘‘(B) DYNAMIC EFFECTS.—Calculations of 
generational accounts policy options shall incor-
porate dynamic effects from induced changes in 
employment, national saving, and capital forma-
tion, as relevant to each particular policy option 
described in paragraph (7)(C). 
‘‘(13) GENERATIONAL ACCOUNT REPORT.— 
‘‘(A) 
IN
GENERAL.—The 
term 
‘generational account report’ means a report 
that, in accordance with this paragraph, in-
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cludes generational accounts and a discussion of 
generational account policy effects. 
‘‘(B) SCENARIOS.—A generational account 
report shall address generational accounts, in-
cluding net Federal tax burdens, under— 
‘‘(i) a baseline estimate; and 
‘‘(ii) an alternative scenario estimate. 
‘‘(14) 
GENERATIONAL
NET-TAX-BURDEN 
GAP.—The term ‘generational net-tax-burden gap’ 
means the ratios of the generational account of 
males and females born 17 years before the budget 
year to the generational accounts of males and fe-
males, respectively, born 18 years before the budget 
year minus 1 times 100. 
‘‘(15) IMPLICIT DEBT.— 
‘‘(A) IN
GENERAL.—The term ‘implicit 
debt’ means the difference between— 
‘‘(i) the discounted present value of 
projected annual Federal spending during 
the period of the budget year and not less 
than the ensuing 75 fiscal years, excluding 
spending for net interest and principal 
payments on Treasury liabilities; and 
‘‘(ii) the discounted present value of 
Federal tax and non-tax receipts during 
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the period of the budget year and not less 
than the ensuing 75 fiscal years. 
‘‘(B) PROJECTION PERIOD.—Annual Fed-
eral noninterest spending and receipts used to 
calculate implicit debt shall be projected 
through a future fiscal year, at least 75 years 
beyond the budget year, and such that the ac-
crual to the fiscal gap by extending the calcula-
tion by 1 additional fiscal year is within 0.1 
percent of the fiscal gap without extending the 
calculation by 1 fiscal year. 
‘‘(C) FEDERAL
BUDGET
PROJECTIONS.— 
The growth of Federal noninterest spending 
and receipts over future fiscal years shall be 
consistent with the baseline projections of popu-
lation growth, general price inflation (Personal 
Consumption Expenditures index), and labor- 
productivity-growth factors including techno-
logical change, capital intensity, and labor effi-
ciency, as determined by the applicable agency. 
‘‘(D) DISCOUNT RATES.—For purposes of 
calculating the implicit debt, the discount rates 
shall be the interest rate projections of the Con-
gressional Budget Office over the projection ho-
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rizon on Treasury bonds with prospective matu-
rity of at least 20 years and longer. 
‘‘(16) NET FEDERAL TAX BURDEN.—The term 
‘net Federal tax burden’ means the difference be-
tween Federal taxes paid and transfer payments re-
ceived. 
‘‘(17) 
SOCIAL
INSURANCE
PROGRAM.—The 
term ‘social insurance program’— 
‘‘(A) means a social insurance program 
that is funded out of a Federal trust fund; and 
‘‘(B) includes the Federal old-age, sur-
vivors, and disability insurance benefits pro-
gram under title II of the Social Security Act, 
the Medicare program under parts A and B of 
title XVIII of the Social Security Act, and the 
Medicare Prescription Drug Coverage under 
part D of title XVIII of the Social Security Act. 
‘‘(18) 
TREASURY
LIABILITIES.—The 
term 
‘Treasury liabilities’ means the face amount of obli-
gations issued under chapter 31 of title 31, United 
States Code, and the face amount of obligations 
whose principal and interest are guaranteed by the 
United States Government (except guaranteed obli-
gations held by the Secretary of the Treasury)—as 
in section 3101(b) of title 31.’’. 
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