U.S. federal debt on track to reach unsustainable level in 30 years, CBO reports
By Jennifer Haberkorn
25 June 2019
(Los Angeles Times) – The nation’s federal debt by the end of the year will reach the highest level since shortly after World War II and is on pace to reach historic and unsustainable levels within 30 years, according to a government report released Tuesday.
The federal debt already equals 78% of the nation’s gross domestic product. It is on track to reach 92% by the end of the next decade and 144% by 2049, according to calculations compiled by the Congressional Budget Office.
Phillip L. Swagel, director of the nonpartisan agency responsible for putting together budget estimates for Congress, warned that the rising debt poses “substantial risks for the nation and presents policymakers with significant challenges.”
“High and rising federal debt increases the likelihood of a fiscal crisis because it erodes investors’ confidence in the government’s fiscal position and could result in a sharp reduction in their valuation of Treasury securities,” the report says. [more]
Federal debt on track to reach unsustainable level in 30 years, CBO reports
The 2019 long-term budget outlook
25 June 2019 (CBO) – Each year, the Congressional Budget Office publishes a report presenting its budget projections for the next 30 years. Those extended baseline projections generally reflect current law. This report is the latest in the series.
Debt in CBO’s Extended Baseline Projections. Large budget deficits over the next 30 years are projected to drive federal debt held by the public to unprecedented levels—from 78 percent of gross domestic product (GDP) in 2019 to 144 percent by 2049. That projection incorporates CBO’s central estimates of various factors, such as productivity growth and interest rates on federal debt. CBO’s analysis indicates that even if values for those factors differed from the agency’s projections, debt several decades from now would probably be much higher than it is today. [more]
