The public debt of the United States will reach 181% of GDP in 2053. At the same time the federal debt in the form of securities over the next 10 years will amount to 115% of GDP. This is reported by TASS, citing a report of the Congressional Budget Office.
Total public debt in the US will reach 181% of GDP in 2053. At the same time the federal debt in the form of securities in the next 10 years will amount to 115% of GDP.
Analysts said back in February that public debt was projected to reach 195% of GDP by 2053. In their report the experts decided to reduce the expected figure due to the agreement reached between the US administration of President Joe Biden and the Republicans to raise the national debt ceiling by 2025 and to cut budget expenditure.
America’s budget deficit over the next 30 years will far exceed the 1993-2022 average of 3.7% of GDP, rising to 6.4% of GDP in 2033 and 10% of GDP in 2053. At the same time, the budget deficit will be around 7.3% of GDP by 2053. This is more than double the average for the last half century. The US budget deficit is expected to be 5.8% of GDP this year. Debt in the form of securities held by the public will reach 98% of GDP this year and will reach a record 107% of GDP in 2029.
Experts say that the costs of interest payments on bonds, social security systems and health programmes will continue to rise. While revenues will remain virtually unchanged, at around 18-19% of GDP, and will continue to decline until 2026.
The individual income tax rate will return to a higher level after 2025, when the tax cuts, which were passed by former US President Donald Trump’s administration back in 2017, will expire. The publication notes that lawmakers from both parties have pledged to maintain all or part of these tax cuts. At the same time, current US President Biden intends to keep them only for American families who earn less than $400,000 a year. Such moves would increase the debt-to-GDP ratio.
“Economy-wide borrowing costs will rise, leading to a reduction in private investment,” experts say.
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