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US budget deficit to break $1 trillion in fiscal 2020, CBO says

The U.S. budget deficit is on track to break $1 trillion in
2020, the Congressional Budget Office said Tuesday.
That estimate is a slight increase from the August 2019
projection and comes with a GDP growth estimate of 2.2%.
The U.S. budget deficit likely will break the $1 trillion
barrier in 2020, the first time that has happened since 2012,
according to Congressional Budget Office estimates released
Tuesday (Jan. 28).
After passing that mark this year, the deficit is expected
to average $1.3 trillion between 2021-30, rising from 4.6%
of GDP to 5.4% over the period. That’s well above the longterm
average since around the end of World War II. The
deficit since then has not topped 4% of GDP for more than
five consecutive years, averaging just 1.5% over the period.
As part of a spending pattern that the CBO deemed unsustainable,
the national debt is expected to hit $31.4 trillion
by 2030.
Tuesday’s projections reflect a slight increase from the estimates
presented in August 2019.
“A trillion-dollar deficit is not a milestone to be proud
of, nor one to brush aside. Over half of the deficit is due to
the choice of policymakers to borrow to fund recent tax cuts
and spending increases,” Maya MacGuineas, president of
the Committee for a Responsible Federal Budget, said in a
statement. “CBO’s report confirms that not only are we in
uncharted waters, but that we are also leaving future generations
with an incredible burden.”
In addition to the debt and deficit outlook, the CBO expects
the economy to grow at a 2.2% pace in 2020. The office
also estimated that real exports will rebound this year, driven
mostly by a push in aircraft exports once the Boeing 737
MAX deliveries resume.
Economic growth also will come based on continued consumer
strength and a rebound in business fixed investment,
according to the CBO.

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