Congressional Budget Office Projects Significant Rise in Federal Spending and Interest Costs
The Congressional Budget Office (CBO) forecasts a substantial increase in federal spending, rising from 23.3% of GDP in 2026 to 27.9% in 2056. Conversely, federal revenues are projected to grow at a much slower pace, from 17.5% to 18.8% over the same period. A significant component of this spending increase is the government's net interest costs, which the CBO estimates will exceed $1 trillion in fiscal year 2026. This amount would represent approximately 3.3% of GDP and nearly 14% of total federal spending. The CBO further projects that these interest costs will continue their upward trajectory, reaching $2.1 trillion by fiscal year 2036, at which point they would constitute 4.6% of GDP and account for 19% of federal spending for that year. This indicates a growing fiscal imbalance where spending outpaces revenue collection, leading to increased reliance on borrowing. 
