The latest Federal budget projections from the non-partisan Congressional Budget Office underline the terrible state of the public finances. This year's deficit is now expected to reach $1,480bn, or 9.8% of GDP. Although the deficit should narrow gradually as the economy improves, we doubt it will fall below 5% of GDP in the foreseeable future. In the longer-term, the deficit is projected to widen again as the retirement of the Baby Boomers swells social security and healthcare spending.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services