CBO expects $2.3 trillion deficit before Biden relief plan.
The Congressional Budget Office says the federal government is on track for a $2.3 trillion deficit this year, down roughly $900 billion from last year when the coronavirus caused Congress to provide historic amounts of financial aid
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The Congressional Budget Office says the federal government is on track for a $2.3 trillion deficit this year, down roughly $900 billion from last year when the coronavirus pandemic led Congress to provide historic amounts of financial aid.
Stronger economic growth has helped to reduce the anticipated shortfall for this year. Still, the deficit could soon be revised upward if President Joe Biden s $1.9 trillion coronavirus relief package becomes law. The additional aid — coming after roughly $4 trillion was approved last year — would add more red ink once enacted, but isn't included in Thursday's CBO projections.
Excluding the Biden plan, this year's deficit will equal 10.3% of gross domestic product, which is a measure of the total value of the economy's goods and services. The past two years have the highest deficits relative to GDP since 1945.
The CBO expects the budget deficit to fall to about $1 trillion in 2022 as the economy heals and there is less need for government spending. Deficits are supposed to average 4.4% of GDP from 2022 to 2031.
Several decades of deficit spending has meant that the total federal debt held by the public is slightly larger than GDP. That figure is projected to rise to 107% of GDP by 2031 as spending on Medicare and Social Security increases.