The Government Accountability Office has called on Congress to develop a long-term fiscal plan that incorporates fiscal targets and rules and consider alternative approaches that better connect decisions about the debt ceiling to decisions related to revenue and spending to help address the federal government’s unsustainable fiscal future.
Debt held by the public is expected to increase from approximately 97 percent of gross domestic product in fiscal year 2022 to 106 percent of GDP within a decade and continue to climb at an increasing pace, GAO said in a report published Tuesday.
“We project that this ratio could reach more than 219 percent of GDP by 2051, absent any changes in revenue and spending policies,” the GAO report reads.
The congressional watchdog noted that delays in suspending or increasing the borrowing limit pose additional risks to the fiscal outlook.
President Joe Biden on Saturday signed into law a bipartisan measure to suspend the debt ceiling through January 2025, preventing a default on U.S. obligations.