US Debt To Be Twice The Size Of GDP By 2037

America’s federal debt could be double the size of its GDP by 2037, said a report by the Congressional Budget Office (CBO) on Tuesday, with debt figures already set to reach 70 percent of the nation’s GDP by end of the year.

According to the CBO, America’s budget deficit is presently the highest it has been since 1945, with lower tax revenues and increased federal spending to blame for the nation’s soaring debt.

America’s federal debt could be double the size of its GDP by 2037, said a report by the Congressional Budget Office (CBO) on Tuesday, with debt figures already set to reach 70 percent of the nation’s GDP by end of the year.

According to the CBO, America’s budget deficit is presently the highest it has been since 1945, with lower tax revenues and increased federal spending to blame for the nation’s soaring debt.

The CBO added that unless current fiscal policies were changed by the country, America’s debt will exceed 90 percent of GDP by 2022, before reaching its historical peak of 109 percent by 2026, and approach 200 percent in 2037.

[quote]“If current laws remained in place, spending on the major federal health care programs alone would grow from more than 5 percent of GDP today to almost 10 percent in 2037 and would continue to increase thereafter.”[/quote]

Related: Infographic: America’s Federal Budget & Debt Burden In 2011

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“Spending on Social Security is projected to rise but much less sharply. Altogether, the aging of the population and the rising cost of health care would cause spending on the major health care programs and Social Security to grow from more than 10 percent of GDP today to almost 16 percent of GDP 25 years from now.”

“That combined increase is equivalent to about $850 billion today,” wrote the report.

Mitt Romney, the Republican presidential front-runner, squared the blame firmly on the current Obama administration in the White House.

“Today’s CBO report confirms that President Obama has placed us on a path to fiscal ruin,” said Romney’s policy director Lanhee Chen in a statement cited by AFP.

[quote]”This is a president who promised to cut the deficit in half but proceeded to run four consecutive trillion-dollar deficits and accumulate nearly as much publicly held debt as all prior presidents combined.”[/quote]

“Instead of tackling entitlement reform, he (Obama) has made clear that he has no plan for addressing the challenge.”

“It is immoral to place such a burden on future generations, and Mitt Romney will not allow it to continue,” Chen added.

Steny Hoyer, the number two House Democrat, argued though that Republican “intransigence” was to blame as they refused to accept any other fiscal measures, such as tax increases, other than spending cuts.

“CBO’s report is a warning that we must get our fiscal house in order by achieving big and balanced deficit reduction that includes both spending and revenues.”

[quote]”Cutting domestic spending alone won’t work, and it will require both parties working together, he said.[/quote]

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White House spokesman Jay Carney added: “This is arithmetic, not calculus. There is either an option that says dealing with our deficits and debt should — the responsibility for that — should be borne entirely, almost, by the middle class and seniors and folks who depend on programs like Medicaid, or it should be borne evenly, in a balanced way, which is what the president believes.”

Roberton Williams, a former CBO economist, told the Miami Herald  that both Republican and Democrat politicians had to agree on taxes and spending before America’s debt problems could be settled.

[quote]”The most important message is, putting it simply, you can’t have your cake and eat it too. You can’t have low taxes and high spending.”[/quote]