The Congressional Budget Office announced Tuesday that the federal budget deficit is projected to hit $1.9 trillion this year, up $400 billion from February projections, in a new report. The report also reveals that the debt held by the public currently equals 99% of the gross domestic product, or GDP.
The office attributed the increase to multiple factors, including, ”foreign military aid, the Biden administration’s student loan actions, the Federal Deposit Insurance Corporation’s slower-than-expected recovery of payments made in response to bank failures over the past two years, higher outlays for Medicaid and increases in discretionary spending,” The Hill reported.
A decade from now, the Congressional Budget Office projects national debt will soar to $50.7 trillion and account for 122% of the GDP, up just over $2 trillion from the group’s February estimate of $48.3 trillion and 116% of the GDP, per The Washington Post.
The 122% mark is the highest recorded in U.S. economic history, passing even the post World War II high of 106%, the report said.
From 2025 until 2034, the budget deficit is projected to total $22.1 trillion, the largest contributor to which is recent legislation that included, “emergency supplemental appropriations that provided $95 billion for aid to Ukraine, Israel, and countries in the Indo-Pacific region,” the CBO said.
The report also reveals that economic growth will “slow 3.1% in calendar year 2023 to 2.0% in 2024 amid higher unemployment and slightly lower inflation.”
It further predicts that “economic growth remains steady at 2.0% in 2025 before settling at roughly 1.8% in 2026 and later years.”
Entering further into election season, the country’s ailing economic health is yet another point for candidates to campaign on, which Maya MacGuineas, president of the nonpartisan Committee for a Responsible Federal Budget, told the Post is sorely needed.
“The risks that we run from this growing mountain of debt run the gamut from slower economic growth to lower incomes, an inability to respond to emergencies and a weaker role in the world,” MacGuineas said. “Nothing could be more urgent, but none of our leaders have a plan to address this glaring problem.”