FEDERAL DEFICITS AND DEBT WILL SOAR, SAYS CONGRESSIONAL BUDGET OFFICE
July 6, 2010
The federal government will face crushing budget deficits and a rapidly soaring national debt unless there is a drastic change in policy over the next few decades, according to an analysis from the Congressional Budget Office (CBO).
- Federal spending will climb to 26 percent of gross domestic product (GDP) within the next decade and reach highs of up to 35 percent by 2035.
- Rising health care costs combined with an aging population will lead to significant increases in federal spending and the national debt will grow worse unless sweeping policy changes occur.
- The national debt is estimated to rise as high as 87 percent of GDP in 10 years, make its way to 109 percent by 2025 and could peak at 185 percent by 2035.
The CBO calls the long-term budget outlook "daunting," and predicts that rising costs will force policymakers to make tough decisions on where and how to cut spending.
There is little agreement on the primary cause of the deepest federal deficit -- now 60 percent of GDP -- since the end of World War II. Some blame record government spending while others point to American wars and Bush's tax cuts as the culprit. But both sides agree that the country cannot sustain its current path.
Source: Chris Moody, "Congressional Budget Office report says federal deficits and debt will soar," Daily Caller, July 2, 2010.
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