Deficit and Debt

In our chapter on economic policy, we discuss the deficit and the debt. New figures from the Congressional Budget Office are not encouraging. From CBO's letter to Senator Daniel Inouye (D-HI), chair of the Appropriations Committee:

Under the President’s budget, debt held by the public would grow from $7.5 trillion (53 percent of GDP) at the end of 2009 to $20.3 trillion (90 percent of GDP) at the end of 2020. As a result, net interest would more than quadruple between 2010 and 2020 in nominal dollars (without an adjustment for inflation); it would expand from 1.4 percent of GDP in 2010 to 4.1 percent in 2020.

Here are year-by-year deficit figures: