Meeting Fiscal Goals Under CBO's May 2023 Baseline

We estimate that it would take $16.0 trillion of deficit reduction to balance the budget over a decade, $3.5 trillion to stabilize debt at 110 percent of Gross Domestic Product (GDP) in ten years, or $8.4 trillion of deficit reduction to stabilize debt at its current level as a share of GDP, based on CBO's latest budget projections. We also estimate that primary balance, which excludes interest spending, could be achieved with $8.8 trillion of savings over a decade, and reducing the budget deficit to 4 percent of GDP would require $6.7 trillion of savings. 

Savings Needed to Meet Various Fiscal Goals

Fiscal Goal  Five-Year Savings Ten-Year Savings
Debt Targets  
Stabilize debt at 110 percent of GDP n/a $3.5 trillion
Stabilize debt at 100 percent of GDP  $2.4 trillion $7.4 trillion
Stabilize debt at 97.5 percent of GDP (current level)  $3.2 trillion $8.4 trillion
Reduce debt to 90 percent of GDP  $5.6 trillion $11.3 trillion
Reduce debt to 80 percent of GDP  $8.9 trillion $15.3 trillion
Deficit Targets*  
Reduce deficit to 4 percent of GDP $2.6 trillion $7.6 trillion
Reduce deficit to 3 percent of GDP $4.0 trillion $9.9 trillion
Primary Balance^ $3.8 trillion $8.8 trillion
On-Budget Balance^ $6.4 trillion $13.0 trillion
Full Budget Balance^ $7.5 trillion $16.0 trillion

Sources: Congressional Budget Office and Committee for a Responsible Federal Budget. Figures include interest. ^Balance figures are adjusted to exclude the effects of timing shifts. *Assumes modified savings path of the CRFB Fiscal Blueprint for Reducing Debt and Inflation

There is no one right fiscal goal, but as policymakers negotiate a possible budget deal it can be helpful to work toward one. Even incremental progress can help to fight inflation, bolster economic growth, and put the budget on a more sustainable path.