US debt to hit 134% of GDP by 2037, record high for developed nations, says Congressional Budget Office

The United States' debt is projected to reach a record high of 134% of its economic output, the gross domestic product (GDP), by 2037, according to a Congressional Budget Office (CBO) report. This marks a new high for developed nations.<br><br>The CBO found that debt surpassed the nation's GDP for the first time in 2021 and has continued to rise, hitting about 102% of US GDP in 2023. It projects the level of debt to increase significantly, reaching 134% of GDP in 2037 and a staggering 168% by 2053.<br><br>This raises concerns about the long-term sustainability of the fiscal policy. The CBO warns that if the debt continues to grow at this rate, it could lead to higher interest costs, reduce the government's ability to respond to future crises, and pose economic risks for future generations.<br><br>While the budget deficit is expected to narrow over the next decade, the demographic changes, such as an aging population and the retirement of baby boomers, will put pressure on social security and Medicare spending. Additionally, the costs of servicing the debt will continue to rise as interest rates increase.