Federal debt held by the public will nearly double as a percentage of gross domestic product over the next 30 years, according toprojections from the Congressional Budget Office.
Federal debt held by the public in 2008 was equal to 39 percent of GDP, and has risen to 75 percent of GDP today. The budget office predicts this debt will rise to 86 percent of GDP in 2026 and to 141 percent in 2046, which would be the highest ratio of debt to GDP ever recorded. The current high ratio of 106 percent was recorded just after World War II.
The debt is projected to increase because the government is spending outside of its means, especially on entitlement programs like Social Security and Medicare. The government is also paying increasing amounts of interest on its debt.
Social Security and Medicare spending alone is projected to account for about half of all federal noninterest spending in the next 30 years. “Federal outlays for those two programs made up almost 40 percent of the government’s noninterest spending, on average, during the past 10 years, compared with 16 percent 50 years ago,” the report states.