As the world economy slowly recovers from the very deep and widespread recession of recent years, many countries confront very serious fiscal imbalances.Most of the discussion in this paper will be about the measurement of fiscal imbalances and the size of necessary adjustments, rather than about the strength of fiscal institutions in different countries. The author will, however, comment on a variety of approaches that have been attempted and are currently being discussed for facilitating necessary fiscal adjustments. Although this paper is about the fiscal situations and prospects for developed economies around the world, the authors begin with a more detailed case study of the United States, a convenient choice because of the importance of the U.S. economy and because of the availability of detailed projections.