CBO: Federal Budget Deficit To Exceed $1 Trillion Annually Beginning In 2022

The Congressional Budget Office in its most recent report on Jan. 28 projects that the federal budget deficit will reach $900 billion in 2019 and will exceed $1 trillion each year beginning in 2022. Over the coming decade, deficits will fluctuate between 4.1% and 4.7% of gross domestic product (GDP), well above the average over the past 50 years.

Still, the CBO’s projection of the deficit for 2019 is now $75 billion less—and its projection of the cumulative deficit over the 2019–2028 period, $1.2 trillion, is less than it was in spring 2018. That reduction in projected deficits results primarily from legislative changes — most notably, a decrease in emergency spending.

However, because of persistently large deficits, federal debt held by the public is projected to grow steadily, reaching 93% of GDP in 2029, its highest level since just after World War II and about 150% of GDP in 2049 — far higher than it has ever been. Moreover, if lawmakers amended current laws to maintain certain policies now in place, even larger increases in debt would ensue.     MORE

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