The economy is expected to grow more slowly over the next three decades, according to a Congressional Budget Office (CBO) report released last week. Increased government spending and weak population growth are the primary factors driving the expected slowdown.
The CBO made its prediction in its long-term budget and economic outlook report, which spans from 2025 to 2055. In the report, the CBO also said it expects publicly held debt to reach 156% of gross domestic product in 2055, down from 166% by 2054, it predicted in last year’s report.
The report said that with lower birth rates, the United States is becoming more dependent on immigrants in the workforce to sustain growth. Without immigration, the U.S. population could begin shrinking in 2023, the CBO said.
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The predictions assume all laws set to expire will expire, including specific provisions of President Trump’s 2017 tax cuts. However, the White House has indicated the tax cuts will be renewed and potentially expanded. Tariffs and spending reductions could alter the CBO predictions.
Treasury Secretary Scott Bessent has said he believes the Trump administration can fix debt, government spending, and economic growth challenges. He has advocated for a plan to reduce the federal deficit by 3%, boost GDP growth by 3%, and produce an additional 3 million barrels of oil daily by 2028. Earlier this month, Bessent called the CBO scoring system crazy.
“I was in the investment business for 35 years, I thought I understood how crazy CBO scoring is,” Bessent told CNBC earlier this month. “And now that I’m on the other side of the wall, I can tell you it’s really crazy. And very unlikely that we are going to get any credit in the CBO scoring for tariffs.”
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Kristen Smithberg
Kristen Smithberg is a Colorado-based freelance writer who covers commercial real estate, insurance, benefits and retirement topics for BenefitsPRO and other industry publications.
