Debt On Track to Exceed Records in Just 5 Years
The Congressional Budget Office (CBO) released its latest Budget and Economic Outlook today, projecting that the national debt will surpass its record as a share of the economy by 2028 and top 118 percent of the economy by 2033. Debt held by the public will grow by $22 trillion over the next decade, nearly doubling to $46 trillion by 2033.
CBO estimates the deficit will total $1.4 trillion in 2023 and more than double to nearly $2.9 trillion by 2033. Interest costs grow from $475 billion in 2022 to more than $1.4 trillion – a record 3.6 percent of GDP – by 2033.
And three major federal trust funds – the Highway Trust Fund, Medicare Hospital Insurance, and Social Security Old-Age and Survivors Insurance – will be exhausted within the next decade.
The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
Today’s CBO report should provide an important dose of reality for politicians making promises they can’t afford to keep. Our debt is headed to a new record in only 5 years, while interest costs will triple over the next decade. Social Security and Medicare Hospital Insurance are only a decade from insolvency.
Contrast these projections against politicians in both parties applauding a call to leave Social Security and Medicare untouched. The do-nothing plan means massive cuts to payments and benefits upon insolvency, leaving vulnerable seniors to pay for Washington’s inaction, or an explosion of debt, leaving future generations to pay the bill. Lawmakers should be coming up with a plan to prevent this from happening.
Furthermore, choosing not to adopt a budget that changes course means endorsing the current plan to adopt an eye-popping $22 trillion over the coming decade – something that no one can seriously defend as a good idea.
While decisions around the President’s costly student debt cancellation boosted recorded deficits in 2022 and artificially lowered them in 2023, structural deficits continue to grow. CBO projects debt will nearly double as we borrow $22 trillion over the next decade. We're on course to borrow nearly $3 trillion in 2033 alone. How absurd it would be to proclaim fiscal victory when our outlook is this daunting.
It’s time for policymakers to stop grandstanding and demagoguing these important issues and wake up to the reality: we will need to make changes to spending on Social Security, Medicare, and other programs, and we need to raise the necessary revenue to fund them. Everything should be on the table to get our unsustainable fiscal problems under control.
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