With the economy continuing its slow recovery, the administration’s Mid-Session Review budget projections released on Friday show little change in the overall outlook. Under the President’s policies, the Office of Management and Budget (OMB) anticipates a deficit for the current fiscal year of $583 billion, down $66 billion from the administration’s March projection and far below the trillion-dollar-plus deficits that came with the Great Recession.
It is important to remember, however, that the federal debt -- high by historical standards, at nearly $17.6 trillion -- remains a deep concern, even with quite favorable economic and political assumptions.
Under its proposed budget, the administration says, the 10 annual deficits over the next decade would add another $5.5 trillion to that total. That is up by nearly $600 billion over the March budget.
While the deficit is lower than the earlier projection for 2014-16, it is higher in all subsequent years. The biggest change is that revenues are now projected to be $760 billion lower over the coming decade.
As a result of higher deficits in the out years, debt held by the public is now projected to be slightly higher (72 percent of GDP) in 2024 than projected in the March...