The Congressional Budget Office (CBO) projects the federal government’s budget will have a deficit of $1.9 trillion in Fiscal Year 2025, which runs from October 1, 2024, to September 30, 2025.
Furthermore, it predicts that the deficit will continue to increase. CBO says that by FY 2035, the federal government’s budget deficit will be $2.7 trillion.
“From 2025 to 2035, debt swells as increases in mandatory spending and interest costs outpace growth in revenues. Federal debt held by the public rises from 100 percent of GDP this year to 118 percent in 2035, surpassing its previous high of 106 percent of GDP in 1946,” the CBO report says.
Furthermore, CBO projects “economic growth cools from an estimated 2.3 percent in calendar year 2024 to 1.9 percent in 2025 and 1.8 percent in 2026 amid higher unemployment and lower inflation.”
“The Federal Reserve continues reducing interest rates through the end of 2026, which supports economic growth. Real GDP then grows by 1.8 percent per year, on average, through 2035. Roughly four-fifths of the growth over that period is due to increases in the productivity of the labor force. The rest is due to increases in the size of the labor force,” the report adds.
The CBO says that the inflation rate will fall from an estimated 2.5 percent in 2024 to 2 percent in 2027.
America currently has over $36 trillion in debt.
Earlier this week, the CBO projected that the American population will grow slowly over the next generations.
Over the next 10 years, this projection says that America will see a .4 percent population growth. However, from 2036 to 2055, the population growth is predicted to be .1 percent.
“Without immigration, the population would shrink beginning in 2033, in part because fertility rates are projected to remain too low for a generation to replace itself,” the report says.
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Zachery Schmidt is the digital editor of The Star News Network. Email tips to Zachery at zschmidt1717@gmail.com. Follow Zachery on Twitter @zacheryschmidt2.
