July 19, 2010

Medium-Term Debt Exceeds Expectations

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The above chart examines the most recent Long-Term Budget Outlook Congressional Budget Office projections of federal debt for the next 25 years. Projections are shown under the CBO baseline, alternative scenario, and the alternative scenario incorporating crowding out effects.  Data from this most likely scenario are only given through 2030 because at this gargantuan level of debt, CBO models simply break down.

In the best case scenario, debt increases from around 60% of GDP in 2010 to 80% of GDP in 2035; in the most realistic scenario, debt held by the public as a percentage of GDP skyrockets to 188%of GDP by 2030.

Veronique de Rugy discusses the debt in The American.