06/27/2024

CBO Raises Federal Deficit Projection by $400 Billion

This is higher than its original estimate released in February

The Congressional Budget Office (CBO) said last week that it projects this year’s federal budget deficit to be $400 billion higher than its original estimate released in February.

The major contributors to the new projection include higher costs from the supplemental spending package signed in the spring that provides military aid to Ukraine and Israel; higher than estimated costs of reducing student loan borrower balances and increased Medicaid spending.

The report also projects that the nation’s publicly-held debt is set to increase from 99 percent of gross domestic product at the end of 2024 to 122 percent of GDP by the end of 2034.

What they're saying: House Budget Committee Chairman Jodey Arrington (R-TX) responded to the new CBO forecast by saying "Congress must reverse the spending curse of the Biden administration by undoing expensive and overreaching executive actions."

White House spokeswoman Karine Jean-Pierre countered the report is “further evidence of the need for Congress to pass President [Joe] Biden’s budget to reduce the deficit by $3 trillion – instead of blowing up the debt with $5 trillion of more Trump tax cuts.”

This article was provided to OSAP by ASAE's Power of Associations and Inroads.