Federal debt held by the public is now over 70% of US GDP. That's the highest percentage since 1950.
If the US goes over the fiscal cliff, the Congressional Budget Office (CBO) projects the annual deficit will drop from the $1.1 trillion registered in FY2012 to about $200 billion in FY2022. That would bring the deficit held by the public down to 58% of GDP.
Under the CBO's "alternative scenario", the Bush tax cuts would be extended, the alternative minimum tax and Medicare payments to physicians would be, respectively, adjusted and waived, and the automatic spending cuts mandated by the 2011 Budget Control Act wouldn't be made. In the "alternative scenario", the deficit is projected to average 5% of GDP a year over the decade. The debt to GDP ratio is projected to hit 90% of GDP in 2022 and to continue rising.
The FY2013 budget builds in the fiscal cliff. If it is approved as proposed, the CBO projects the deficit will fall to 4.0% of GDP this year (from 7.3% in FY2012) and 2.4% in FY2014. The downside is that GDP would contract 0.5% and unemployment rise to 9.1% in 2013.
If the US goes over the fiscal cliff, the Congressional Budget Office (CBO) projects the annual deficit will drop from the $1.1 trillion registered in FY2012 to about $200 billion in FY2022. That would bring the deficit held by the public down to 58% of GDP.
Under the CBO's "alternative scenario", the Bush tax cuts would be extended, the alternative minimum tax and Medicare payments to physicians would be, respectively, adjusted and waived, and the automatic spending cuts mandated by the 2011 Budget Control Act wouldn't be made. In the "alternative scenario", the deficit is projected to average 5% of GDP a year over the decade. The debt to GDP ratio is projected to hit 90% of GDP in 2022 and to continue rising.
The FY2013 budget builds in the fiscal cliff. If it is approved as proposed, the CBO projects the deficit will fall to 4.0% of GDP this year (from 7.3% in FY2012) and 2.4% in FY2014. The downside is that GDP would contract 0.5% and unemployment rise to 9.1% in 2013.
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