The Congressional Budget Office on Tuesday said that the budget deficit and the public debt in the United States would continue to rise progressively over the next decade to hit the worst levels since the World War II if the existing and spending remains the same.
Deficit, Debt To Rise
In "The Budget and Economic Outlook: 2020 to 2030" report published Tuesday, the CBO said the federal budget deficit would hit $1 trillion this year and then average $1.3 trillion between 2021 and 2030.
The federal agency predicted that the deficit against the overall gross domestic product would rise from 4.6% this year to 5.4% in 2030.
"Other than a six-year period during and immediately after World War II, the deficit over the past century has not exceeded 4.0 percent for more than five consecutive years," the report said. According to CBO, the average deficit over the last 50 years has been 1.5%.
Unless the policies change, the national debt could rise 98% of the GDP by 2030, from 81% in 2020, CBO predicted. If things keep going unchanged for longer, the debt could be 180% of the GDP by 2050.
Economy Continues Growth, Unemployment Low
The CBO kept a positive outlook on the GDP growth, projecting it to grow 2.2% this year, and at an average rate of 1.7% in the rest of the decade. The slowing economic growth will primarily be due to slower growth in the labor force, the report noted.
The unemployment rate will remain under the historic low at 3.5% in 2020, but steadily rise to cross the natural rate by 2024 at 4.4% due to slower economic growth, according to CBO.
House Committee Schedules Hearing
The House of Representatives Committee on the Budget will hold a hearing on the report later today with CBO Director Phillip Swagel.
"I hope that more eyes will be opened to the stark reality we face," Steve Womack, a ranking member of the committee and Arkansas representative, said in a statement. "It is imperative that we put our country on a responsible fiscal path and deliver on our duty to the American people."