The U.S. federal budget deficit is forecast to hit a record $3.3 trillion due to huge government expenditures to fight the COVID-19 pandemic and prop up the economy.
The U.S. Congressional Budget Office said the pandemic measures have added more than $2 trillion to the federal budget deficit, and that the latest projections mean that the federal debt will exceed annual gross domestic product (GDP) next year — a milestone that would put the U.S. where it was following World War II, when accumulated debt exceeded the size of the economy.
The $3.3-trillion figure is more than triple the 2019 deficit and more than double the levels experienced after the Great Recession of 2008-09. Government spending, fueled by four COVID-19 response measures, will add at $6.6 trillion to the overall national debt.
By year’s end, the publicly held national debt in the U.S. will total 98% of U.S. GDP, the total output of goods and services. That compares with 79% of GDP at the end of 2019 and 35% back in 2007. The Congressional Budget Office forecasts that debt will exceed 100% of GDP in 2021 and reach a record high of 107% by the end of 2021.
The Congressional Budget Office, a nonpartisan economic and research arm of Congress, forecasts that the U.S. deficit will total $13 trillion over the coming decade.
