Congressional Budget Office said Thursday that the federal budget deficit will begin to decline in the next few years as the US economy recovers from the coronavirus pandemic, but will increase again in the second half of 2010 and steadily increase in the next 20 years. I predicted that.
Forecasts are short-term to the country’s financial situation, which is expected to improve as government spending on pandemics subsides as more Americans get vaccinated and get jobs and normal business activities resume. Provide hope. However, nonpartisan offices anticipate a more difficult long-term outlook as interest rate costs rise and federal spending on healthcare programs increases as the population ages.
This outlook also does not reflect the additional spending that Congress expects to approve this year. This could include $ 1.9 trillion incentives and a large infrastructure package. Earlier CBO estimates suggest that this borrowed package will exacerbate the budget deficit in the short term.
The CBO expects the federal budget deficit (the gap between what the US spends and what it costs for taxes and other income) to 10.3% of GDP this year, the second highest level since 1945. Said. It is expected to drop to 5.7 percent of GDP by the end of the decade as spending to fight the pandemic eases and growth recovers. But over the next 20 years, he said the budget gap would widen again, rising to 13.3 percent by 2051.
Federal debt held by the public is expected to be 102% of GDP by the end of this year, almost doubling (202%) in 30 years. The CBO warned that such high debt levels would increase borrowing costs, slow economic production and increase the risk of a financial crisis.
The Congressional Budget Office warns that rising federal debt puts the United States at risk of a financial crisis.
Source link The Congressional Budget Office warns that rising federal debt puts the United States at risk of a financial crisis.