Forget fudged computer models predicting climate doom, look at the real scary numbers.
U.S. government debt held by the public is expected to rise to 107 percent of the economy in 2040 from 74 percent this year, the Congressional Budget Office said, citing an aging population and rising health-care costs.
With debt “already unusually high” relative to gross domestic product, “further sustained increases could be especially harmful to economic growth,” the CBO said in a long-term fiscal report released Tuesday in Washington. “To put the federal budget on a sustainable path for the long term, lawmakers would have to make major changes to tax policies, spending policies, or both.”
The non-partisan agency kept its forecast for this fiscal year’s deficit at 2.7 percent of GDP. Stronger economic growth and constraints on federal spending will keep the shortfalls close to their current percentage of GDP through 2019, the CBO said.
Beyond that, higher interest rates and rising health-care and Social Security costs will boost spending, widening the deficit to 3.8 percent of GDP in 2025 and 6.6 percent in 2040, the agency said in the report.