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Though the economy continues its recovery and we have made some progress on deficits, our deficits will begin growing again soon, and major long-term fiscal challenges remain. The Congressional Budget Office (CBO) warns that "such large and growing federal debt could have serious negative consequences, including restraining economic growth in the long term, giving policymakers less flexibility to respond to unexpected challenges, and eventually increasing the risk of a fiscal crisis."
In its new Budget and Economic Outlook report, CBO projects that deficits will total $7.9 trillion over the next 10 years, while public debt will rise from $13 trillion in 2014 to $21 trillion by the end of 2024.
CBO’s current-law projections are, if anything, optimistic. Under less optimistic assumptions about the future, the budget deficit would be even worse.
As a share of the economy, our national debt is already higher than at any time since 1950, shortly after the end of World War II. CBO’s new report warns that, unless current policies change, debt will climb even higher and become unsustainable in coming decades. Policymakers should work together to close the long-term gap between spending and revenues, preserve important public investments for the future, and put the budget on a sustainable long-term path.