A Trump banner hangs on the side of The Heritage Foundation ahead of the Inauguration on January 17, 2025 in Washington, DC. U.S. President-elect Donald Trump and Vice President-elect Sen. JD Vance (R-OH) will be sworn in on January 20. (Photo by Kayla Bartkowski / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
WASHINGTON, United States — The United States is set to see its debt level swell to a record over the coming decade, the Congressional Budget Office said Friday, days before President-elect Donald Trump takes office.
Trump has vowed to take quick action to hike tariffs on imports — cast as a potential way to boost revenues — while his Treasury secretary pick took aim this week at federal spending.
But the president-elect’s campaign promises of tax cuts threaten to add to deficits, critics say, warning of an unsustainable fiscal path.
As mandatory spending levels and interest costs rise, outpacing revenue growth, US debt is expected to balloon from 2025 to 2035, the CBO said in its report Friday.
Such mandatory spending covers such huge budget categories as Social Security and Medicare.
The debt as a share of gross domestic product will rise from 100 percent this year to 118 percent in 2035 — reaching a new high.
The federal budget deficit, meanwhile, is projected to hit $1.9 trillion, the report by the nonpartisan agency added.
Although revenues are set to total $5.2 trillion in 2025 and rise as a share of GDP by 2027, the CBO said this was partially due to expiring provisions of a tax law enacted by the first Trump administration.
But Trump and his Treasury secretary nominee Scott Bessent have called for tax cuts to be extended, changing the situation.
Earlier CBO estimates indicated that extending the tax cuts would add more than $4 trillion to the deficit over the next decade.
This means policymakers may have to find ways to offset the impact, such as by lowering spending.
The CBO report Friday also indicated the amount of federal debt subject to an overall limit would keep increasing — reaching about $59.3 trillion by 2035.
The debt ceiling is a limit on government borrowing to pay for bills already incurred.
The Treasury Department is expected to start taking measures this month to avoid defaulting on the government’s obligations.