The United States’ long-term fiscal picture is so dire that if current policies continue, the national debt would be more than six times the size of the U.S. economy in 75 years, according to a report being released Thursday by a fiscal watchdog group.
Under current law, the debt would double from 78 percent of gross domestic product (GDP) now to 160 percent by 2050 and hit 360 percent of GDP by 2093, according to the report from the Committee for a Responsible Federal Budget.
But under a different scenario that assumes policies like the recent boosts in federal spending and tax cuts are extended, debt would break an all-time record in just over a decade, the report said.
Under that scenario, the debt would soar to almost 225 percent of GDP by 2050 and to more than 600 percent of GDP in 75 years.
Federal deficits under that scenario would rise from about 4 percent of GDP in 2018 to 16 percent by 2050 and 34.5 percent by 2093 — which would surpass even the massive deficits used the finance World War II, the report said.
CRFB said its long-term model was built on projections by the Congressional Budget Office, which provides forecasts 30 years into the future, though it did acknowledge that the 75-year projections are “highly uncertain.”
“The United States will not be able to sustain its current fiscal course over the next 75 years,” the report says. “While CBO’s 30-year budget outlook already shows a bleak picture of rapidly rising deficits and debt, both would grow to unbelievable levels over the very long term.”
The picture is so bleak that in order to reduce the debt to the historic average of 41 percent of GDP over 75 years, lawmakers would have to come up with between $12.8 trillion and $13.7 trillion of spending cuts and/or tax increases over the next 10 years, the report said.
That would be the equivalent of cutting primary spending by 26 to 28 percent or increasing revenues by 29 to 31 percent, it said.
The Treasury Department said earlier this month that the federal budget deficit was $779 billion in fiscal 2018 — up $113 billion, or 17 percent, from the previous year and the highest level since 2012.
The government took in more than $3.3 trillion in revenue - $14 billion more than the prior year - but spending jumped more than $127 billion.
President Trump and Congress agreed earlier this year to lift strict caps and boost spending by about $300 billion in 2018 and 2019.