The CBO released its updated US long term budget outlook yesterday. Although the outcomes are not as “bad” as previous reports, the drivers of government spending remain on an unsustainable track. The full document can be found here but posted below are slides from this morning’s testimony to the House of Representatives Committee on the Budget.
Here’s the gist:
Although the gap between federal spending and revenues has narrowed recently, CBO’s long-term projections show a substantial imbalance in the federal budget, with revenues falling well short of spending if current laws governing taxes and spending stayed generally the same. After the next few years, growing budget deficits would push federal debt back to and above its current high level. By 2039, federal debt held by the public would exceed 100 percent of gross domestic product, a level seen only once before in U.S. history (just after World War II). Moreover, debt would be on an upward path relative to the size of the economy, a trend that could not be sustained indefinitely.