January 05, 2017

US is within days of $20 trillion in national debt

The US is within days of reaching $20 trillion in national debt according to the US debt clock

The state and local debt is a combined $3.1 trillion.
California has $465 billion in debt
NY has $354 billion in debt
Texas $273 billion in debt
Florida $181 billion in debt
Illinois has $155 billion in debt
Pennsylvania has $126 billion in debt
New Jersey $104 billion in debt

U.S. federal debt as percent of GDP by Senate majority party from 1940 to 2009

Federal outlays were projected to rise by 6 percent in 2016 —to $3.9 trillion, or 21.2 percent of GDP. That increase is the result of a nearly 7 percent rise in mandatory spending, a 3 percent increase in discretionary outlays (which stem from annual appropriations), and a 14 percent jump in net interest spending.

CBO anticipates that mandatory outlays will be $168 billion higher in 2016 than they were last year. A significant component of that growth is Social Security outlays, which are expected to increase by about $28 billion (or 3 percent)—a percentage increase that is smaller than last year’s, primarily because beneficiaries did not receive a cost-of-living adjustment in 2016 but did receive one in 2015. Nevertheless, because the program is so large, even that smaller-than-average increase accounts for one-sixth of the growth in mandatory spending projected for 2016. Federal spending for the major health care programs accounts for a much larger fraction—more than 60 percent—of the projected growth in mandatory spending: Outlays for Medicare (net of premiums and other offsetting receipts), Medicaid, and the Children’s Health Insurance Program, plus subsidies for health insurance purchased through exchanges and related spending, are expected to be $104 billion (or 11 percent) higher this year than they were in 2015.

In CBO’s baseline projections (which incorporate the assumption that current laws will generally remain the same), growth in spending—particularly for Social Security, health care, and interest payments on federal debt—outpaces growth in revenues over the coming 10 years. The budget deficit increases modestly through 2018 but then starts to rise more sharply, reaching $1.4 trillion in 2026. As a percentage of GDP, the deficit remains at roughly 2.9 percent through 2018, starts to rise, and reaches 4.9 percent by the end of the 10-year projection period. The projected cumulative deficit between 2017 and 2026 is $9.4 trillion.

President Trump and the Republican congress are expected to lower taxes and increase stimulus programs.

SOURCES - US Debt clock, CBO

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