Waste of the Day: Prediction: Debt Will Soon Break Record
Topline: The Congressional Budget Office’s annual 10-year economic forecast warns that, by 2030, the federal debt held by the public will be $40.3 trillion, or 108% of the country’s gross domestic product — an amount never before seen in American history.
Key facts: The federal debt held by the public differs slightly from the overall federal debt because it excludes money that government agencies owe to each other. Most economists consider it a more meaningful statistic. It reached $30.2 trillion in 2025, the CBO notes.
By 2036, it will be even higher: the debt held by the public will be $56.2 trillion, the CBO predicts. That would be 120% of GDP. It has never been higher than 106%.
The debt is expected to grow because, under current policy, the U.S. will spend $24.2 trillion more than it collects from taxes and other revenue from 2027 to 2036, according to the CBO.
The CBO’s estimates assume that military spending will only increase slightly, but President Donald Trump has already called for the defense budget to increase by roughly 67% next year. If that happened without corresponding spending cuts, the U.S. would take on another $5.8 trillion of debt by 2036, according to the Committee for a Responsible Federal Budget.
The CBO also predicts the cost of Medicare will almost double to $2 trillion per year by 2036. Inflation is expected to be 2.8% this year, an “elevated” level caused by tariffs, according to the CBO. The estimate was published before the Supreme Court struck down most of the tariffs Trump created in 2025, though the president has vowed to restore them within five months.
Still, the CBO now expects the American economy to grow at a faster rate than originally predicted in 2025. Even though the CBO said it expected tariffs to reduce consumer spending and slow economic growth, that will be more than offset by tax cuts in the One Big Beautiful Bill Act. The wealthiest 10% of households are expected to have an extra $14,000 of spending money per year that can be used on American products.
However, the poorest 20% of households are expected to have less spending money because of cuts to programs like Medicaid and food stamps.
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Summary: With every passing year, the federal debt crisis becomes less of an abstract, faraway problem and more of an immediate concern.
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