US government debt to beat 'records' of WWII

The US government debt held by the public continues to rise, and can reach the point equal to that during World War II. Keith Hall, the Director of the U.S. Congressional Budget Office, warns of an unpleasant record.

Photo: Source: Pravda.Ru photo archive

In case it happens, the US debt will reach 104% of GDP in 1945, or 106% of GDP in 1946. Now, the US debt makes up 74% of GDP, that is 69% more of the GDP the government had in 1943 after Pearl Harbour.

The U.S. Congressional Budget Office claims that within the current tendency the debt will make up 101% of GDP by 2039, and in 2040 it will be 103%.

Currently, the debt held by the public is estimated at 13,1 trillion dollars, and intragovernmental debt at 5 trillion dollars, that is 18,1 trillion dollars of the US total debt.

"As a result, budget deficits are projected to rise steadily and, by 2040, to raise federal debt held by the public to a percentage of GDP seen at only one previous time in U.S. history-the final year of World War II and the following year," Hall said.

"This means an average middle income household would have to pay $1,700 more in federal taxes in 2016 and larger amounts in subsequent years," he said. "Or by cutting non-interest spending across the board, average Social Security benefits for a 65-year-old in the middle of the earnings distribution would have to drop by $2,400 in 2016 and by larger amounts in later years."

Also read: US Budget Office concerned with drastic debt grow

Pravda.Ru

Read article in Russian on the Russian version of Pravda.Ru

Read more on the subject here