It doesn't include all future liabilities but it does include Social Security and Medicare liabilities through 2080. In fact, one useful thing about long-run budget projections is that it is harder to hide such liabilities. As I'm sure you know, the government is currently borrowing the Social Security surplus and this serves to make the deficit and publicly-held debt look smaller. However, Social Security is projected to stop running surpluses in 2018 (excluding interest) and to have cashed in all of its government bonds by 2040. Medicare stopped running surpluses just this year and is projected to have cashed in all of its bonds by 2018. Hence, the government will no longer be able to borrow Social Security's surpluses to mask the deficit after 2018 and the publicly-held debt will be very nearly equal to the gross federal debt (the one that's now over $8 trillion) by 2040. In any case, the following graph shows projected federal outlays through 2080:
As before, the actual numbers and sources are at http://home.att.net/~rdavis2/pro2007.html. Also, at that URL is a comparison of all of the long-run projections since Clinton's last budget. As bad as the current projections are, they've greatly improved over the last couple of budgets. The way in which they've improved makes me suspect that they may now be overly optimistic. I'll copy below one of the points from that URL that describes this improvement:
12) The deficit projected for 2080 rose sharply from 11.7% of GDP in the 2001 Budget to 33.5% of GDP in the 2004 Budget and dropped sharply to 13.7% of GDP in the 2007 Budget. The following table shows the makeup of the 21.8% of GDP increase from 2001 to 2004 and the 19.8% of GDP drop from 2004 to 2007:
COMPONENTS OF CHANGE IN DEFICIT PROJECTED FOR 2080
Component of change 2001-04 2004-07
--------------------- ------- -------
Receipts............. -0.7 3.1
Discretionary Outlays -3.2 0.4
Mandatory Outlays.... 0.3 1.8
Net Interest......... -18.1 14.5
--------------------- ----- ----
Deficit change....... -21.7 19.8
As can be seen, the largest component of the rise and fall in the projected deficit is Net Interest. This shows how a relatively small difference in annual receipts or outlays can cause a much larger difference in net interest. This is because net interest is based on the debt which is the accumulation of all past deficits.
Points 13 and 10 on that page go on to look at the change in Receipts and Mandatory Outlays, the next two largest components in the recent fall of the projected deficit.
You made the comment: "There are currently no proposals to use that household net worth to service the federal debt."
The use of the words "no proposals" is a bit misleading. Governments generate no income; taxpayers inevitably pay all liabilities of government , if those liabilities actually get paid rather than defaulted. The absence of a plan or a specific proposal of how or when does not negate the realities that are going to be dealt with by payment, default or a compromise that involves both.
I agree. The cost of the debt will have to be addressed one way or another. My point was that the lack of a proposal to address it will make doing so that much more difficult.