The US government is still "living beyond its means", with the federal budget deficit expected to come in at $1 trillion for this year according to new forecasts from the CBO.
That's a huge amount of money, but it is actually way down on the $3 trillion or so that the deficit has averaged over the last two years, when government spending dramatically increased in response to the pandemic as multiple stimulus checks, tax credits and other relief programs were introduced. As the chart above shows, those deficits were worth almost 13-15% of the entire value of the US economy.
Debt on your debt
Going forward the CBO forecasts that the US federal deficit is likely to steadily rise from around 4% of GDP this year to around 6% of GDP by 2032. Incredibly, less than half of that estimated deficit is actually from spending — the majority is actually just interest payments on debt we already owe.
