The odds that you will see a recession during your first four years are therefore quite high. Maybe not in your first year in office, but a recession is something you need to plan for. Given the fiscal reality that you will be facing and the limited number of arrows left in the Federal Reserve’s monetary policy quiver, your administration is going to have a difficult time dealing with the fallout from a recession.

Let’s look at fiscal reality. Sometime in your first year the US national debt will top $20 trillion. The deficit is running close to $500 billion, and the Congressional Budget Office projects that figure to rise. Add another $3 trillion or so in state and local debt. As you may imagine, the interest on that debt is beginning to add up, even at the extraordinarily low rates we have today.

Sometime in 2019, entitlement spending, defense, and interest will consume all the tax revenues collected by the US government. That means all spending for everything else will have to be borrowed. The CBO projects the deficit will rise to over $1 trillion by 2023. By that point entitlement spending and net interest will be consuming almost all tax revenues, and we will be borrowing to pay for our defense. Let’s look at the following chart, which comes from CBO data:

By 2019 the deficit is projected to be $738 billion. Almost every president wants to run for a second term. To forge any hope of being successful with that second run, a president needs to able to say that he or she made a difference on the budget. There are only three ways to reduce that deficit: cut spending, raise taxes, or authorize the Federal Reserve to monetize the debt. At the numbers we are now talking about, getting rid of fraud and wasted government expenditures is a rounding error. Let’s say you could find $100 billion here or there. You are still a long, long way from a balanced budget.

But implicit in the CBO projections is the assumption that we will not have a recession in the next 10 years. Plus, the CBO assumes growth above what we’ve seen in the last year or so. Let’s contemplate what a budget might look like if we have a recession. I asked my associate Patrick Watson to go back and look at past recessions and determine what level of revenue losses occurred because of the recessions, and then to assume the same average percentage revenue loss for the next recession. We randomly decided that we would hypothesize our next recession to occur in 2018. Whether it happens in 2017 or 2019, the relative numbers are the same, and so is the outcome: it would blow out the budget. Here’s a chart of what a recession in 2018 would do. Entitlement spending and interest would greatly exceed revenue.

The deficit would balloon to $1.3 trillion, and if the recovery occurs along the lines of our last (ongoing) recovery, then unless we reduce spending or raise revenues, we will not see deficits below $1 trillion over the following 10 years. The deficit will climb to $1.5 trillion just as you dive into the thick of your second campaign in 2020. Not exactly a great campaign platform.

But before I get all gloom and doom on you, let me say that I think there is a path by which you can actually prevent a recession. There is a path to stimulating growth, creating new jobs, and spurring a real economic recovery – but not by doing the same things we have done for the past 16 years. If we continue in the same general direction that we have been going, the economic realities I talked about above are going to clobber you and what will be a very scared Congress in the next four years.

No Senator or Representative is going to want to run for election in the middle of a recession, with deficits topping $1 trillion. If you think people are vehement in demanding change today, they will really be out with the pitchforks in 2018 in 2020 if we don’t get a grip on our budget and our economy. If we can’t figure out how to engender growth and create new jobs – and real jobs – the general rejection of “establishment candidates” will continue to intensify. You have an opportunity to really change things, and the public clamor should give you a great negotiating base for forcing Congress to deal with the realities in the above charts.

But you are going to have to have a plan, and that is where the rubber meets the road. Every president chooses a chairperson for his or her Council of Economic Advisers. Whom you should choose is going to be in large part a function of the type of policies you will try to pursue. In the past, presidents have tended to choose an economic advisor who was more or less mainstream (great academic background, general acceptance in the economic community, etc.) –in short, an establishment economist.