CBO projects deficits will add up to $12.7 trillion through 2029

CBO projects deficits will add up to $12.7 trillion through 2029
The Congressional Budget Office (CBO) on Thursday projected that federal government deficits will add up to $12.7 trillion from 2019 through 2029.
 
The nonpartisan CBO estimated that the 2019 deficit would reach $896 billion and exceed $1 trillion annually starting in 2022.
 
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The estimate for this year's deficit was $1 billion lower than the CBO's previous estimate, and the cumulative deficit from 2020 to 2029 is now expected to be about 2 percent smaller than previously projected.
 
The main reason for the 2 percent decline was a reduction in estimated mandatory spending and net interest payments, according to the CBO, which said its economic forecasts remain the same and that it had not fully updated its revenue projections.
 
Budget watchdogs said the figures underscore that the fiscal path is unsustainable.
 
“We’re only halfway through this fiscal year and the deficit has already reached a staggering $691 billion. That’s higher than all but five full-year deficits in U.S. history,” said Michael A. Peterson, CEO of the Peter G. Peterson Foundation. “Our growing debt burden will reduce opportunity, lower incomes, and only make it harder to fund important priorities in the future."
 
Maya MacGuineas, president of the fiscally hawkish Committee for a Responsible Federal Budget, said the problem will only get worse if new spending plans don’t include offsets.
 
“The last Congress cut taxes and increased spending by a combined $2.4 trillion. Now we’re talking about $2 trillion more of spending, and as much as $2 trillion on top of that for infrastructure, with virtually no word of how we will pay for them,” she said. “At some point, the fiscal recklessness has to stop.”
 
The CBO analysis is based on existing laws and programs, which include severe spending cuts due to statutory spending caps and the eventual expiration of tax breaks associated with the 2017 GOP tax law.
 
The CBO said that if those laws were changed, the nation’s debt burden would rise to 105 percent of gross domestic product by 2029, just 1 percentage point below its 1946 peak of 106 percent.