CBO: National debt will reach 185% of GDP by 2052
The deficit was $2.8 trillion in 2021, driven by COVID-19 stimulus spending, and it's projected to drop to $1 trillion as the COVID relief funding winds down
The Congressional Budget Office (CBO) estimated on Wednesday that the national debt will reach 185% of GDP in 2052.
According to the CBO's latest Budget and Economic Outlook, the national debt will drop to 96% of Gross Domestic Product (GDP) in 2023 but it will rise to a record 110% of GDP by 2032.
"While CPI inflation will be 4.7 percent in 2022 and 2.7 percent in 2023. Unpaid-for extensions of expiring legislation, spending increases, or tax cuts would make the fiscal outlook even worse," read a Committee for a Responsible Federal Budget (CRFB) analysis of CBO's figures.
Maya MacGuineas, president of the CRFB, said although the deficit is projected to drop this year compared to last, "deficits will remain extremely high and debt is on course to reach a new record as a share of the economy by 2031."
The deficit was $2.8 trillion in 2021, driven by COVID-19 stimulus spending. According to the CRFB analysis, CBO's data shows that the nation's annual deficit will add a whopping $16 trillion to the debt by 2032 under current law.
MacGuineas said that "expiring COVID relief and massive inflation, along with the economic recovery, have helped provide a fiscal reprieve" but warned that "trillion-dollar deficits are here to stay, and $2 trillion deficits will arrive by 2031."
She also warned that "the rising costs of Social Security, health care, and interest on the debt will continue to eclipse revenue growth, and the debt will keep rising."
MacGuineas called on policymakers to "work together to truly bring our deficit and debt under control."
"Rather than celebrating the false victory of returning from fiscally-disastrous to fiscally-bad, we should work to achieve a position of actual fiscal health," she said.
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