1、FEBRUARY|2024The Budget and Economic Outlook:2024 to 2034Projections at a GlanceThe Federal BudgetThe deficit totals$1.6trillion in fiscal year 2024,grows to$1.8trillion in 2025,and then returns to$1.6trillion by 2027.Thereafter,deficits steadily mount,reaching$2.6trillion in 2034.Measured in relati

2、on to gross domestic product(GDP),the deficit amounts to 5.6percent in 2024,grows to 6.1percent in 2025,and then shrinks to 5.2percent in 2027 and 2028.After 2028,deficits climb as a percentage of GDP,returning to 6.1percent in 2034.Since the Great Depression,deficits have exceeded that level only d

3、uring and shortly after World War II,the 20072009financial crisis,and the corona virus pandemic.Debt held by the public increases from 99percent of GDP at the end of 2024 to 116percent of GDPthe highest level ever recordedby the end of 2034.After 2034,debt would continue to grow if current laws gene

4、rally remained unchanged.Outlays in 2024amount to 23.1percent of GDP and stay close to that level through 2028.After 2028,growth in spending on programs for elderly people and rising net interest costs drive up outlays,which reach 24.1percent of GDP by 2034.Revenues amount to 17.5percent of GDP in 2

5、024,decline to 17.1percent in 2025,and then climb to 17.9percent of GDP by 2027after certain provisions of the 2017tax act expire.Revenues remain near that level through 2034.Changes in CBOs Budget Projections Since May2023The deficit for 2024 is$0.1trillion smaller than CBO projected in May 2023,an

6、d the cumulative deficit for the 20242033period is$1.4trillion(or 7percent)smaller.The biggest factor contributing to smaller projected deficits is a reduction in discretionary spend-ing stemming from the Fiscal Responsibility Act and the Further Continuing Appropriations and Other Extensions Act,20

7、24.The U.S.EconomyEconomic growth slows in 2024as unemployment increases,partly as a result of tight monetary policy.Real(inflation-adjusted)GDP growth accelerates in 2025after the Federal Reserve responds to weaker economic conditions in 2024by lowering interest rates.Interest rates rose in 2023as

8、the federal funds rate increased to its highest level since 2001.In CBOs projections,that rate begins to decline in the second quarter of calendar year 2024.Interest rates on 10-year Treasury notes rise in 2024 and then fall through 2026.Inflation(as measured by the price index for personal consumpt

9、ion expenditures)slowed markedly in 2023.In CBOs projections,it slows further in 2024to a rate roughly in line with the Federal Reserves long-run goal of 2percentand then ticks up in 2025,before declining slightly.Changes in CBOs Economic Projections Since February2023Growth of real GDP is weaker th

10、rough 2026,similar in 2027,and slightly stronger afterward.Interest rates are generally higher.From 2024 to 2027,those higher rates mostly reflect the effects of stronger-than-expected economic growth in 2023.In later years,higher rates are driven by more capital income and less private saving.The l

11、abor force is larger because net immigration,which began increasing in 2022,remains ele-vated through 2026.CBOs baseline budget and economic projections reflect the assumption that current laws governing taxes and spending will generally remain unchanged.Deficits and outlays have been adjusted to ex

12、clude the effects of shifts that occur in the timing of certain payments when the fiscal year begins on a weekend.Without those adjustments,the deficit projected for 2024 is$1.5 trillion(or 5.3 percent of GDP).www.cbo.gov/publication/59710By the NumbersThe Budget Outlook,by Fiscal YearSee Chapter 1.

13、When October 1(the first day of the fiscal year)falls on a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shifted into the previous fiscal year.Outlays and deficits have been adjusted to remove the effects of those timi

14、ng shifts.Percentage of GDPBillions of dollarsAverage,19742023Actual,2023202420252034Actual,2023202420252034Revenues17.316.517.517.117.94,4394,9354,9967,474Individual income taxes8.08.18.88.69.52,1762,4692,5203,973Payroll taxes6.06.05.95.95.91,6141,6631,7342,466Corporate income taxes1.81.62.01.71.34

15、20569494551Other1.50.80.80.81.2229234247485Outlays21.022.723.123.124.16,1236,5176,76810,032Mandatory11.013.913.913.915.13,7423,9084,0616,298Social Security4.45.05.25.35.91,3481,4531,5452,471Major health care programs3.45.85.65.56.71,5561,5741,6192,781Medicare2.13.13.23.24.28328969401,740Medicaid,CHI

16、P,and marketplace subsidies1.32.72.42.32.57246786791,042Other mandatory3.23.13.13.12.58388818971,046Discretionary8.06.46.26.05.11,7221,7391,7562,106Defense4.23.02.92.92.58058228451,034Nondefense3.73.43.33.12.69179179111,071Net interest2.12.43.13.23.96598709511,628Total deficit(-)-3.7-6.2-5.6-6.1-6.1

17、-1,684-1,582-1,772-2,557Primary deficit(-)-1.6-3.8-2.5-2.8-2.2-1,025-712-821-929Debt held by the public at the end of each period48.397.399.0101.7116.026,24027,89729,74948,300The Economic Outlook,by Calendar YearSee Table 2-1 on page 45.Domestic corporate profits are estimated for 2023.PercentAnnual

18、 averageActual,20232024202520262027 20282029 2034Change from fourth quarter to fourth quarterReal(inflation-adjusted)GDP3.11.52.22.22.11.9InflationPCE price index2.72.12.22.12.01.9Consumer price index3.22.52.52.22.22.2Payroll employment(net monthly change,in thousands)229841781046351Annual averageUn

19、employment rate3.64.24.44.34.44.5Interest ratesEffective federal funds rate5.05.14.13.32.92.93-month Treasury bills5.14.93.83.12.72.810-year Treasury notes4.04.64.63.93.84.1Tax bases(percentage of GDP)Wages and salaries43.243.543.843.943.843.8Domestic corporate profits9.99.79.69.49.29.0Boxes1-1.How

20、the Fiscal Responsibility Act Affects CBOs Baseline Projections of Discretionary Funding 221-2.Why CBOs Baseline Projections of Discretionary Funding for 2024Differ From Amounts in Its Cost Estimate for the Continuing Resolution 241-3.CBOs Long-Term Budget Projections 402-1.Economic Effects of CBOs

21、Revised Population Projections 503-1.Technical Changes to CBOs Baseline Projections to Account for Developments Affecting Energy-Related Tax Provisions 86ContentsExecutive Summary 1Chapter1:The Budget Outlook 9Overview 9Deficits 9Debt 13Outlays 16Revenues 29The Long-Term Outlook for theBudget 40Unce

22、rtainty of Budget Projections 40Chapter2:The Economic Outlook 43Overview 43Recent Economic Developments 47Projections of Gross Domestic Product and Its Components 48Projections of the Labor Market 56Projections of Inflation andInterestRates 58Projections of Income 61Uncertainty About the EconomicOut

23、look 62Comparison With CBOs February2023Economic Projections 64Comparison With Other EconomicProjections 70Chapter3:Changes in CBOs Baseline Projections Since May2023 75Overview 75Legislative Changes 76Economic Changes 77Technical Changes 82List of Tables and Figures 90About This Document 91Notes Ab

24、out This ReportThe budget projections in this report include the effects of legislation enacted through January 3,2024,and are based on the Congressional Budget Offices economic projections.Those economic projections reflect economic developments and information as of December 5,2023,and are availab

25、le on CBOs website(www.cbo.gov/data/budget-economic-data#4).Unless this report indicates otherwise,all years referred to in describing the budget outlook are federal fiscal years,which run from October1 to September30 and are designated by the calendar year in which they end.Years referred to in des

26、cribing the economic outlook are calendar years.When October 1 falls on a weekend,certain payments that the government would have ordinarily made on that day are instead made at the end of September and thus are shifted into the previous fiscal year.Consequently,the number of payments in that previo

27、us fiscal year increases,and the number in the present fiscal year decreases.Those shifts in the timing of payments affect outlays and deficits(or surpluses)and thus are reflected in the agencys baseline budget projections(see Table 1-1).But timing shifts can complicate comparisons of annual outlays

28、 and deficits and distort cer-tain budgetary trends,so in many cases,CBO presents adjusted baseline projections that treat the payments as if they were not subject to the shifts(for examples,see Tables 1-2,1-4,1-6,and 1-9).Unless this report indicates otherwise,historical data shown in the text,tabl

29、es,and figures describing the economic forecast reflect data available from the Bureau of Economic Analysis and other sources in late January 2024.Those data contain values for the fourth quarter of 2023,which were not available when CBO developed its current projections.Numbers in the text,tables,a

30、nd figures may not add up to totals because of rounding.Some of the figures in this report use shaded vertical bars to indicate periods of recession.(A recession extends from the peak of a business cycle to its trough.)Previous editions of this report often included an appendix of historical budget

31、data.Those data and other supplemental data for this analysis are available on CBOs website(www.cbo.gov/publication/59710#data),as are a glossary of common budgetary and economic terms(www.cbo.gov/publication/42904),a description of how CBO develops its baseline budget projec-tions(www.cbo.gov/publi

32、cation/58916),a description of how CBO prepares its economic forecast(www.cbo.gov/publication/53537),and previous editions of this report(https:/ SummaryThe Congressional Budget Office regularly publishes reports presenting its baseline projections of what the federal budget and the economy would lo

33、ok like in the current year and over the next 10 years if laws governing taxes and spending generally remained unchanged.This report is the latest in that series.Projections for 2024Budget deficit:$1.6trillionDebt held by the public:99%of GDPOutlays:$6.5 trillionRevenues:$4.9 trillionThe Budget Outl

34、ookDeficitsIn CBOs projections,the federal budget deficit grows from$1.6 trillion in fiscal year 2024 to$2.6trillion in 2034.Deficits also expand in relation to the size of the economy,from 5.6percent of gross domestic product(GDP)in 2024,when the collection of certain postponed tax pay-ments tempor

35、arily boosts revenues,to 6.1 percent of GDP in 2025.In 2026 and 2027,reve-nues increase faster than outlays,causing the deficit to shrink to 5.2 percent of GDP by 2027.Thereafter,outlays rise faster than revenues.By 2034,the deficit returns to 6.1 percent of GDPsignificantly larger than the 3.7 perc

36、ent that deficits have averaged over the past 50 years.DebtDebt held by the public rises each year in relation to the size of the economy,reaching 116percent of GDP in 2034an amount greater than at any point in the nations history.From 2024 to 2034,increases in mandatory spending and interest costs

37、outpace declines in discretionary spending and growth in revenues and the economy,driving up debt.That trend persists,pushing federal debt to 172 percent of GDP in 2054.Outlays and RevenuesFederal outlays in 2024 total$6.5 trillion,which amounts to 23.1 percent of GDP.They stay close to that level t

38、hrough 2028 and then increase,reaching 24.1 percent of GDP by 2034.Growth in spending on programs that benefit elderly people and rising net interest costs drive those increases.Revenues in 2024 total$4.9 trillion,or 17.5 percent of GDP.They reach 17.9 percent of GDP in 2027,in part because of the e

39、xpiration of provisions of the 2017tax act,and remain near that level through 2034.Changes in CBOs Budget ProjectionsThe deficit for 2024 is$0.1 trillion(or 4 percent)smaller in CBOs current projections than it was in the agencys May 2023 projections,and the cumulative deficit over the 20242033 peri

40、od is smaller by$1.4 trillion(or 7 percent).The biggest factor contributing to smaller projected deficits over the 10-year period is a$2.3 trillion reduction in projected discretion-ary outlays stemming from the combination of the Fiscal Responsibility Act and the Further Continuing Appropriations a

41、nd Other Extensions Act,2024.Deficits and outlays have been adjusted to exclude the effects of shifts that occur in the timing of certain payments when the fiscal year begins on a weekend.Without those adjustments,the deficit projected for 2024 is$1.5 trillion(or 5.3 percent of GDP).2THE BUDGET AND

42、ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024The Budget Outlook in Six FiguresTotal Outlays and RevenuesMeasured as a percentage of GDP,federal outlays exceed their 50-year average each year from 2024 to 2034 in CBOs projections.Revenues fall below their 50-year average in 2025 but hover slightly abov

43、e it thereafter.See Figure 1-3 on page 27.Percentage of GDP Projected17.924.9744201420242034RevenuesAverage revenues,1974 to 2023(17.3)Average outlays,1974 to 2023(21.0)OutlaysThe Budget Outlook,by Fiscal YearSee Chapter 1.When October 1(the first day of the fiscal year)falls o

44、n a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shifted into the previous fiscal year.Outlays and deficits have been adjusted to remove the effects of those timing shifts.Percentage of GDPBillions of dollarsAverage,1

45、9742023Actual,2023202420252034Actual,2023202420252034Revenues17.316.517.517.117.94,4394,9354,9967,474Individual income taxes8.08.18.88.69.52,1762,4692,5203,973Payroll taxes6.06.05.95.95.91,6141,6631,7342,466Corporate income taxes1.81.62.01.71.3420569494551Other1.50.80.80.81.2229234247485Outlays21.02

46、2.723.123.124.16,1236,5176,76810,032Mandatory11.013.913.913.915.13,7423,9084,0616,298Social Security4.45.05.25.35.91,3481,4531,5452,471Major health care programs3.45.85.65.56.71,5561,5741,6192,781Medicare2.13.13.23.24.28328969401,740Medicaid,CHIP,and marketplace subsidies1.32.72.42.32.57246786791,04

47、2Other mandatory3.23.13.13.12.58388818971,046Discretionary8.06.46.26.05.11,7221,7391,7562,106Defense4.23.02.92.92.58058228451,034Nondefense3.73.43.33.12.69179179111,071Net interest2.12.43.13.23.96598709511,628Total deficit(-)-3.7-6.2-5.6-6.1-6.1-1,684-1,582-1,772-2,557Primary deficit(-)-1.6-3.8-2.5-

48、2.8-2.2-1,025-712-821-929Debt held by the public at the end of each period48.397.399.0101.7116.026,24027,89729,74948,3003EXECUTIVE SUMMARy THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034Outlays,by CategoryIn CBOs projections,rising spending for Social Security and Medicare boosts mandatory outlays.Disc

49、retionary spending as a share of GDP falls to historic lows.And mounting debt and higher interest rates cause net outlays for interest to increase.Starting next year,net interest costs are greater in relation to GDP than at any point since at least 1940,the first year for which the Office of Managem

50、ent and Budget reports such data.See Figure 1-4 on page 28.Outlook for 2024 2034Increases in mandatory spending and rising net interest costs push outlays to$10.0 trillion,or 24.1%ofGDP,in2034.Revenues in 2034 total$7.5 trillion,or 17.9%of GDP.Percentage of GDPMandatoryDiscretionaryNet interest Proj

51、ected15.1 5.1 3.90544201420242034Revenues,by CategoryReceipts from individual income taxes fell sharply as a percentage of GDP in 2023,from a historic high in 2022.They declined in part because capital gains on sold assets were smaller and because the Internal Revenue Service e

52、xtended some tax payment deadlines.As those delayed payments are made,revenues rise in 2024.They rise again in 2026 and 2027,following the scheduled expiration of certain provisions of the 2017 tax act.See Figure 1-5 on page 33.Percentage of GDP Projected9.55.91.31.20369994200420142024203

53、4OtherCorporate income taxesPayroll taxesIndividual income taxes4THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Total Deficit,Net Interest Outlays,and Primary DeficitIn CBOs projections,the total budget deficitthe amount by which outlays exceed revenuesequals 6.1 percent of GDP in 2034.Ne

54、t interest payments grow in relation to GDP,reaching 3.9 percent of GDP in 2034.Primary deficits(which exclude net outlays for interest)increase in 2025,decline over the next few years,and then increase again.See Figure 1-1 on page 12.Percentage of GDP Projected5054420242034Net

55、 interestoutlaysTotal deficitPrimary deficitPrimary surplusFederal Debt Held by the PublicFederal debt held by the public increases each year in CBOs projections,swelling to an all-time record of 116percent of GDP in 2034.In the two decades that follow,growing deficits cause debt to soar to 172 perc

56、ent of GDP by 2054.See Figure 1-2 on page 15.Percentage of GDP Projected04080005200020252050DebtChanges in CBOs Baseline Projections of the 10-Year Deficit Since May 2023The deficit for the 20242033 period is projected to total$18.9 trillion,$1.4 trillion less than CBO projecte

57、d in May 2023.The biggest factor contributing to smaller projected deficits is the reduction in projected discretionary outlays stemming from the Fiscal Responsibility Act and the Further Continuing Appropriations and Other Extensions Act,2024.Those decreases are partially offset by technical change

58、s that reduce projected revenues and increase projected outlays for Medicare,Social Security,and clean vehicle and energy-related tax credits.See Figure 3-1 on page 76.Trillions of dollars20.318.920242033 deficit in CBOsFebruary 2024 baseline20242033 deficit in CBOs May2023 baselineTechnical changes

59、Net increase in revenues from economic changesNet increase in outlays from economic changesLegislative changes-2.6 0.8-0.6 1.120242033 deficit in CBOs May 2023 baseline20242033 deficit in CBOs February 2024 baseline5EXECUTIVE SUMMARy THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034The Economic OutlookEc

60、onomic GrowthIn calendar year 2023,the U.S.economy grew faster than it did in 2022,even as inflation slowed.Economic growth is projected to slow in 2024 amid increased unemployment and lower inflation.CBO expects the Federal Reserve to respond by reducing interest rates,starting in the middle of the

61、 year.In CBOs projections,economic growth rebounds in 2025 and then moderates in later years.A surge in immigration that began in 2022 continues through 2026,expanding the labor force and increasing economic output.Interest Rates Interest rates rose in 2023 as the federal funds rate(the rate financi

62、al institutions charge each other for overnight loans)increased to its highest level since 2001.In CBOs projec-tions,that rate begins to decline in the second quarter of 2024.Interest rates on 10-year Treasury notes rise in 2024 and then fall through 2026.Inflation Inflation slowed markedly in 2023.

63、In CBOs projections,inflation as measured by the price index for personal consumption expenditures(PCE)slows further in 2024,to a rate roughly in line with the Federal Reserves long-run goal of 2percent.It then ticks up in 2025,before declining slightly.Changes in CBOs Economic ProjectionsSince Febr

64、uary 2023,when CBO published its last full economic forecast,the agency has lowered its projections of economic growth and inflation(as measured by the PCE price index)for 2024.CBO also expects interest rates to be higher from 2024 to 2027 than it projected last year.After 2027,CBOs current and prev

65、ious economic forecasts are generally similar.Outlook for 2024 2034The growth of real GDP slows to a rate of 1.5%in 2024 as inflation continues to decline and the federal funds rate falls.After 2024,real GDP grows at a moderate pace.The Economic Outlook,by Calendar YearSee Table 2-1 on page 45.Domes

66、tic corporate profits are estimated for 2023.PercentAnnual averageActual,20232024202520262027 20282029 2034Change from fourth quarter to fourth quarterReal(inflation-adjusted)GDP3.11.52.22.22.11.9InflationPCE price index2.72.12.22.12.01.9Consumer price index3.22.52.52.22.22.2Payroll employment(net m

67、onthly change,in thousands)229841781046351Annual averageUnemployment rate3.64.24.44.34.44.5Interest ratesEffective federal funds rate5.05.14.13.32.92.93-month Treasury bills5.14.93.83.12.72.810-year Treasury notes4.04.64.63.93.84.1Tax bases(percentage of GDP)Wages and salaries43.243.543.843.943.843.

68、8Domestic corporate profits9.99.79.69.49.29.06THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024The Economic Outlook in Six FiguresOutlook for 2024 2034Real GDP growth averages 2.2%annually from 2025 to 2028.Consumer spending,which shifted sharply toward goods and away from services during t

69、he pandemic,returns to prepandemic patterns.Consumer Spending on Goods and ServicesCBO expects consumer spending to continue shifting from goods to services as people gradually resume their prepandemic patterns of consumption.By 2030,the share of consumer spending devoted to goods returns to its pre

70、pandemic trend of a gradual decline,in CBOs projections.See Figure 2-2 on page 52.Percent Projected262830323436382034203020262022200062002Current projectionJanuary 2020projectionRecessionShare of consumerspending on goods0Growth of Real GDPThe growth of economic output,as measured by the

71、nations GDP,is projected to slow in 2024 because of weaker growth in consumer spending and a decline in business investment in non-residential structures.Growth of real(inflation-adjusted)GDP is projected to increase in 2025 after the Federal Reserve responds to weaker economic conditions in 2024 by

72、 lowering interest rates.See Figure 2-1 on page 44.PercentRecession Projected4202462034203020262022200062002Real GDP growth7EXECUTIVE SUMMARy THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034UnemploymentIn CBOs projections,the unemployment rate rises to 4.4 percent by the fourth quarter of 202

73、4,reflecting the slowdown in economic growth.In later years,the unemployment rate ranges from 4.3 percent to 4.5 percent.Fluctuations in that rate are mainly attribut-able to changes in economic growth and in the size and composition of the labor force.See Figure 2-4 on page 57.Outlook for 2024 2034

74、Unemployment rises to 4.4%by the end of 2024 and then levels off.The labor force expands moderately over the next few years.PercentUnemployment rate Projected024682026202401022002RecessionThe Labor ForceIn CBOs current projections,the number of people who are working or activel

75、y seeking employment continues to expand at a moderate pace through 2026.Higher population growth in those years,mainly from increased immigration,more than offsets a decline in labor force participation due to slowing demand for workers and the rising average age of the population.A large proportio

76、n of recent and projected immigrants are expected to be 25 to 54 years oldadults in their prime working years.See the figure in Box 2-1 on page 50.Millions of people Projected02027202420200320000February 2023 projectionRecessionCurrent projectionLabor forc

77、e 8THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Overall Inflation and Core InflationIn CBOs projections,overall prices(as measured by the PCE price index)increase less in 2024 and 2025 than they did last year.One key reason that inflation is projected to be lower than in recent years is

78、 the easing of upward pressures on the prices of food,energy,and other goods.Another key reason is weaker growth in the prices of shelter services(which reflect the costs of both rental and owner-occupied housing)because of elevated interest rates in 2024.See Figure 2-5 on page 60.Outlook for 2024 2

79、034Inflation falls further over the next few years,dropping to 2.0%or less after2026.Interest rates also decline over the next few years and then stabilize.Percent Projected030222026202401022002Overall inflationCore inflation(excludes food andenergy prices)RecessionFederal Rese

80、rves long-run goalInterest RatesCBO expects that in the second quarter of 2024,the Federal Reserve will respond to slowing inflation and rising unemployment by lowering the federal funds rate,which affects interest rates throughout the economy.Starting this year,the differ-ence between the federal f

81、unds rate and the interest rate on 10-year Treasury notes is projected to gradually return to its long-run average.See Figure 2-6 on page 61.Percent10-year Treasury notesFederal funds rateRecession Projected0203020262022200062002Chapter1:The Budget Outlook OverviewIn the Congre

82、ssional Budget Offices baseline budget projections,the federal budget deficit is$1.5trillion this year and generally increases over the next decade,reaching$2.6trillion in 2034.(If adjusted to exclude the effects of shifts that occur in the timing of certain payments when the first day of the fiscal

83、 year falls on a weekend,this years deficit would be$1.6 trillion.)The cumulative deficit is projected to total$20.0trillion over the 20252034period.Those projections,which were finalized on January3,2024,incorporate the effects of legislation enacted as of that date and therefore do not include the

84、 effects of any subsequent legislation,including the Further Additional Continuing Appropriations and Other Extensions Act,2024(Public Law118-35),which was enacted on January19,2024.1 Incorporating the budget-ary effects of subsequent legislation enacted to date would not significantly change the pr

85、ojections presented here.Measured relative to the size of the economy,the deficit equals 5.3percent of gross domestic product(GDP)in 2024.In CBOs projections,annual deficits generally increase over the 20252034period,averaging 5.7percent of GDP per year,well above the average deficit over the past 5

86、0years.As a result of those deficits,federal debt held by the public increases each year in CBOs projections,rising from 99percent of GDP this year to 116percent in 2034(see Table 1-1).That would be the largest amount ever recordedin U.S.history.The deficits in CBOs current projections are gener-all

87、y smaller than those in the agencys previous baseline projections for 2024 to 2033,which were published in May2023.The budget shortfall for 2024 is now pro-jected to be$63billion smallerand the cumulative deficit for the 20242033period,$1.4trillion lessthan CBO projected last May.Those net decreases

88、 stem from the Fiscal Responsibility Act(FRA,P.L.118-5)and the Further Continuing Appropriations and Other Extensions Act,2024(P.L.118-22),as well as updates to the agencys economic forecast and other changes(see Chapter3).1.Congressional Budget Office,cost estimate for H.R.2872,the Further Addition

89、al Continuing Appropriations and Other Extensions Act,2024(January17,2024),www.cbo.gov/publication/59893.After 2034,deficits continue to increase in relation to the size of the economy in CBOs projections.Outlays increase largely because of rising interest costs and growth in spending for the major

90、health care programs.Revenues also rise over the period,but more slowly than outlays.Such persistently large deficits cause federal debt held by the public,which has recently been at levels not reached since the end of World War II,to rise even further.CBO prepares its baseline budget projections in

91、 accor-dance with provisions set forth in the Balanced Budget and Emergency Deficit Control Act of 1985(the Deficit Control Act,P.L.99-177)and the Congressional Budget and Impoundment Control Act of 1974(P.L.93-344).Those laws require CBO to construct its baseline under the assumption that current l

92、aws governing revenues and spending will generally stay the same.For discretionary funding,CBOs baseline incorporates limits on such funding for 2024 and 2025,as specified in the FRA,and then reflects the assumption(as required by law)that funding will grow with inflation once those caps expire.Disc

93、retionary funding that is not constrained by the caps is generally assumed to increase with inflation throughout the next decade.CBOs baseline budget projections are meant to provide a benchmark that policymakers can use to assess the poten-tial effects of changes in policy.They are not intended to

94、provide a forecast of future budgetary outcomes,because future legislative action could lead to markedly different outcomes.Even if federal laws remained unaltered for the next decade,actual budgetary outcomes would probably differ from CBOs baseline projections,not only because of unanticipated eco

95、nomic conditions but also because of the many other factors that affect federal revenues and outlays,such as administrative actions.DeficitsThe projected$1.5trillion federal budget deficit for 2024 is$188billion less than the shortfall recorded last year.That deficit would be larger,and the decrease

96、 would be smaller,if not for a shift in the timing of certain payments in both 2024 and 2023.October1,2023(the first day of fiscal year 2024)fell on a weekend,so certain payments that would ordinarily have been made on that day were instead made in fiscal year 2023.Likewise,October1,2022,fell on a w

97、eekend,which shifted 10THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Table 1-1.CBOs Baseline Budget Projections,by CategoryTotalActual,20232024202520262027202820292030203342025 20292025 2034In billions of dollarsRevenuesIndividual income taxes2,1762,4692,5202,7893,0313,1243,25

98、13,3813,5113,6343,7933,973 14,715 33,007Payroll taxes1,6141,6631,7341,8121,8841,9602,0392,1212,2052,2912,3792,4669,430 20,892Corporate income taxes420569494495512,4615,094Othera22923424725928329635540242,4393,656Total4,439 4,935 4,996 5,351 5,683 5,870 6,147 6,414 6,

99、656 6,890 7,1687,474 28,046 62,649On-budget3,2463,7063,7114,0134,2954,4304,6504,8605,0415,2135,4295,672 21,100 47,313Off-budgetb1,1941,2291,2851,3371,3871,4401,4961,5541,6151,6771,7401,8036,946 15,336OutlaysMandatory3,7533,8384,0614,2464,4484,7434,8075,1535,4075,6826,1316,320 22,306 50,999Discretion

100、ary1,7221,7341,7561,7911,8251,8661,8931,9371,9752,0162,0662,1069,131 19,231Net interest6598709511,0051,0491,1051,1701,2411,3281,4301,5271,6285,280 12,435Total6,135 6,442 6,768 7,042 7,323 7,715 7,870 8,331 8,710 9,128 9,724 10,054 36,718 82,665On-budget4,9155,1215,3545,5415,7366,0326,0906,4486,7217,

101、0267,5167,738 28,753 64,201Off-budgetb1,2201,3221,4141,5011,5871,6831,7811,8831,9892,1022,2092,3167,965 18,464Total deficit(-)c-1,695-1,507-1,772-1,692-1,640-1,844-1,723-1,917-2,054-2,238-2,556-2,579-8,672-20,016On-budget-1,669-1,414-1,643-1,528-1,441-1,602-1,439-1,588-1,680-1,813-2,087-2,066-7,653-

102、16,888Off-budgetb-26-93-129-164-200-242-284-328-374-425-469-513-1,019-3,128Primary deficit(-)c,d-1,036-637-821-687-591-739-554-676-726-808-1,029-951-3,392-7,581Debt held by the public26,240 27,897 29,749 31,515 33,233 35,141 36,916 38,868 40,945 43,201 45,739 48,300n.a.n.a.Addendum:GDP26,974 28,177

103、29,256 30,504 31,756 33,043 34,375 35,746 37,157 38,609 40,106 41,646 158,933 352,197As a percentage of GDPRevenuesIndividual income taxes8.18.88.69.19.59.59.59.59.59.49.59.59.39.4Payroll taxes6.05.95.95.95.95.95.95.95.95.95.95.95.95.9Corporate income taxes1.62.01.71.61.51.51.51.41.41.31.31.31.51.4O

104、ther a0.80.80.80.80.90.91.01.11.11.21.21.20.91.0Total16.517.517.117.517.917.817.917.917.917.817.917.917.617.8On-budget12.013.212.713.213.513.413.513.613.613.513.513.613.313.4Off-budgetb4.44.44.44.44.44.44.44.34.34.34.34.34.44.4OutlaysMandatory13.913.613.913.914.014.414.014.414.614.715.315.214.014.5D

105、iscretionary6.46.26.05.95.75.65.55.45.35.25.25.15.75.5Net interest2.43.13.23.33.33.33.43.53.63.73.83.93.33.5Total22.722.923.123.123.123.322.923.323.423.624.224.123.123.5On-budget18.218.218.318.218.118.317.718.018.118.218.718.618.118.2Off-budgetb4.54.74.84.95.05.15.25.35.45.45.55.65.05.2Total deficit

106、(-)c-6.3-5.3-6.1-5.5-5.2-5.6-5.0-5.4-5.5-5.8-6.4-6.2-5.5-5.7On-budget-6.2-5.0-5.6-5.0-4.5-4.8-4.2-4.4-4.5-4.7-5.2-5.0-4.8-4.8Off-budgetb-0.1-0.3-0.4-0.5-0.6-0.7-0.8-0.9-1.0-1.1-1.2-1.2-0.6-0.9Primary deficit(-)c,d-3.8-2.3-2.8-2.3-1.9-2.2-1.6-1.9-2.0-2.1-2.6-2.3-2.1-2.2Debt held by the public97.399.0

107、101.7103.3104.7106.3107.4108.7110.2111.9114.0116.0n.a.n.a.Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.GDP=gross domestic product;n.a.=not applicable.a.Consists of excise taxes,remittances from the Federal Reserve System,customs duties,estate and gift taxes,and misc

108、ellaneous fees and fines.b.The revenues and outlays of the Social Security trust funds and the net cash flow of the Postal Service are classified as off-budget.c.When outlays exceed revenues,the result is a deficit.Values in this row were calculated by subtracting outlays from revenues;thus,negative

109、 values indicate deficits.d.Primary deficits exclude net outlays for interest.11CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034payments due on that day into fiscal year 2022(from fis-cal year 2023).If not for those shifts,this years projected deficit would be$1.6trillion,$10

110、2billion less than the$1.7trillion deficit in 2023(see Table 1-2).2 Throughout the rest of this chapter,outlays and deficits(both projected and historical amounts)reflect adjustments to exclude the 2.October1will fall on a weekend again in 2028,2033,and 2034,causing certain payments due on those day

111、s to be made at the end of September and thus to be recorded in the previous fiscal year.Those timing shifts will noticeably boost outlays and the deficit in fiscal years 2028 and 2033;they will reduce federal outlays and deficits in fiscal year 2029.effects of timing shifts.That allows for a cleare

112、r analysis of the underlying annual trends in those budget categories.The 2023deficit was significantly affected by actions related to the Administrations plan to cancel outstanding student loans for many borrowers.Those actions resulted in largely offsetting changes to the deficit in the past two y

113、ears.In September2022,in keeping with the bud-getary procedures used to estimate the costs of federal credit programs,the Administration recorded outlays of$379billion to reflect its estimate of the long-term costs of debt cancellation,which increased the deficit in fiscal year 2022.Because of a Jun

114、e2023Supreme Court Table 1-2.CBOs Baseline Projections of Outlays and Deficits,Adjusted to Exclude Effects of Timing ShiftsActual,2023202420252026202720282029203020334In billions of dollarsAdjustments to exclude effects of timing shifts a-1-154-22Outlays,adjusted for timin

115、g shiftsMandatory3,7423,9084,0614,2464,4484,6324,9195,1535,4075,6825,9846,298Discretionary1,7221,7391,7561,7911,8251,8601,8991,9371,9752,0162,0592,106Net interest6598709511,0051,0491,1051,1701,2411,3281,4301,5271,628Total6,1236,5176,7687,0427,3237,5977,9878,3318,7109,1289,571 10,032Total deficit(-),

116、adjusted for timing shifts b-1,684-1,582-1,772-1,692-1,640-1,727-1,841-1,917-2,054-2,238-2,402-2,557Primary deficit(-),adjusted for timing shiftsb,c-1,025-712-821-687-591-622-671-676-726-808-875-929As a percentage of GDPOutlays,adjusted for timing shiftsMandatory13.913.913.913.914.014.014.314.414.61

117、4.714.915.1Discretionary6.46.26.05.95.75.65.55.45.35.25.15.1Net interest2.43.13.23.33.33.33.43.53.63.73.83.9Total22.723.123.123.123.123.023.223.323.423.623.924.1Total deficit(-),adjusted for timing shifts b-6.2-5.6-6.1-5.5-5.2-5.2-5.4-5.4-5.5-5.8-6.0-6.1Primary deficit(-),adjusted for timing shiftsb

118、,c-3.8-2.5-2.8-2.3-1.9-1.9-2.0-1.9-2.0-2.1-2.2-2.2Addendum:Baseline deficit(-),unadjusted In billions of dollars b-1,695-1,507-1,772-1,692-1,640-1,844-1,723-1,917-2,054-2,238-2,556-2,579As a percentage of GDP b-6.3-5.3-6.1-5.5-5.2-5.6-5.0-5.4-5.5-5.8-6.4-6.2Data sources:Congressional Budget Office;D

119、epartment of the Treasury.See www.cbo.gov/publication/59710#data.GDP=gross domestic product.a.When October 1(the first day of the fiscal year)falls on a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shifted into the pr

120、evious fiscal year.Those shifts primarily affect mandatory outlays;discretionary outlays are also affected,but to a much lesser degree.Net interest outlays are not affected.b.When outlays exceed revenues,the result is a deficit.Values in this row were calculated by subtracting outlays from revenues;

121、thus,negative values indicate deficits.c.Primary deficits exclude net outlays for interest.12THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024decision,however,the cancellation plan was never imple-mented.As a result,in August2023,the Administration recorded a$333billion reduction in outlays

122、 for the student loan program.3 That action reduced the fiscal year 2023deficit.If the reversal of the Administrations plan for student loan cancellations was excluded from the calculation of the deficit in 2023,the deficit that year would have been larger$2.0trillion instead of$1.7trillionand the p

123、rojected decline in deficits from 2023 to 2024in CBOs baseline would be$435billion rather than$102billion.Measured relative to the size of the economy,this years deficit is estimated to be smaller than last 3.The outlay savings recorded by the Administration in 2023 were smaller than the costs recor

124、ded in 2022,primarily because of a new income-driven repayment plan that the Administration finalized in 2023;that plan increased the cost of outstanding student loans.years5.6percent of GDP,down from 6.2percent.(Without the reversal of the student loan cancellations,the 2023deficit would have been

125、7.5percent of GDP.)Deficits in CBOs baseline grow to 6.1percent of GDP in 2025 and then decline over the next two yearsfalling to 5.2percent of GDP in 2027primarily because of the scheduled expiration at the end of calendar year 2025 of some provisions of the 2017tax act(P.L.115-97).After 2028,defic

126、its increase again,reaching 6.1percent of GDP in 2034,the last year of the projection period(see Figure 1-1).The cumulative deficit for the 20252034period is projected to total$19.8trillion,or 5.6per-cent of GDP(excluding the effects of timing shifts).The deficits that CBO projects are large by hist

127、orical standards.Over the past 50years,the annual deficit has averaged 3.7percent of GDP.In CBOs projections,deficits equal or exceed 5.2percent of GDP in every year from 2024 to 2034.Since at least 1930,deficits have not remained that large for more than five years in a row.Figure 1-1.Total Deficit

128、,Net Interest Outlays,and Primary DeficitPercentage of GDP Projected5054420242034Net interestoutlaysTotal deficitPrimary deficitPrimary surplusData source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.When October 1(the first day of the fiscal year)falls on

129、 a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shifted into the previous fiscal year.All projections presented here have been adjusted to exclude the effects of those timing shifts.Historical amounts have been adjust

130、ed as far back as the available data will allow.Primary deficits or surpluses exclude net outlays for interest.When outlays exceed revenues,the result is a deficit.In this figure,deficits and surpluses were calculated by subtracting revenues from outlays;thus,positive values indicate deficits,and ne

131、gative values indicate surpluses.When outlays are subtracted from revenues,as recorded in the federal budget and in the tables in this chapter,negative values indicate deficits,and positive values indicate surpluses.GDP=gross domestic product.In CBOs projections,the total budget deficitthe amount by

132、 which outlays exceed revenuesequals 6.1 percent of GDP in 2034.Net interest payments grow in relation to GDP,reaching 3.9 percent of GDP in 2034.Primary deficits increase in 2025,decline over the next few years,and then increase again.13CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:20

133、24 TO 2034Primary deficitsthat is,deficits excluding net out-lays for interestincrease from 2.5percent of GDP in 2024 to 2.8percent in 2025 and then decrease,reach-ing 1.9percent in 2027in CBOs projections.From 2027 to 2034,primary deficits average 2.0percent of GDP.In the 62years from 1947 to 2008,

134、such deficits exceeded 2.0percent of GDP only three times.In the past 15years,though,they have exceeded that level 12timesin part because of legislation that was enacted in response to the 20072009financial crisis and the coronavirus pandemic that began in early 2020.The primary deficits in CBOs pro

135、jections are especially large given the relatively low unemployment rates that the agency is forecasting.From 2025 to 2034a period in which the average unemployment rate is projected to remain at or below 4.5percent in each yearprimary deficits in CBOs baseline projections average 2.1percent of GDP.

136、By way of historical contrast,from 1974 to 2023the unemployment rate was at or below 4.5per-cent in nineyears;in those years,the budget showed a primary deficit of 0.3percent of GDP,on average.DebtThe deficits projected in CBOs baseline would boost federal debt.That debt can be measured in various w

137、ays.The most common measure is debt held by the public,which consists mostly of securities that the Treasury issues to raise cash to fund the federal governments activities and to pay off its maturing liabilities.4 Other measures are used for different purposes,such as to pro-vide a more comprehensi

138、ve picture of the governments financial condition.Debt Held by the PublicAfter accounting for all the federal governments bor-rowing needs,CBO projects that debt held by the public would rise from$26.2trillion at the end of 2023 to$48.3trillion at the end of 2034(see Table 1-3).As a percentage of GD

139、P,that debt is projected to reach 116percent at the end of 2034about 19percentage points larger than it was at the end of 2023 and nearly two and a half times its average percentage over the past 50years(see Figure 1-2).The net amount that the Treasury borrows each year by issuing securities is dete

140、rmined primarily by the annual budget deficit.However,several other factors also affect 4.A small amount of debt held by the public is issued by other agencies,mainly the Tennessee Valley Authority.the governments need to borrow from the public.Those factorscollectively referred to as other means of

141、 financ-inginclude changes in the governments cash balances and cash flows associated with federal credit programs,such as those related to student loans and loans to small businesses.(Those cash flows are not reflected in the budget deficit,which accounts only for the subsidy costs of credit progra

142、msthat is,the estimated net lifetime costs of the programs loans and loan guarantees.)5 As a result of that additional borrowing,the increase in debt held by the public in 2024will exceed the deficit by about$150billion,CBO projects.Over the 20252034period,the increase in federal debt is projected t

143、o exceed the cumulative deficit by$387billion.The bulk of that additional borrowing stems from the need to finance federal loan programs.The cash dis-bursements needed to finance those programs each yearfor example,in the case of direct loans,the funds lent to borrowers minus the repayments of princ

144、ipal and payments of interest and other feesare greater than the net subsidy costs that are recorded in the budget.The Treasury needs to borrow funds each year to make up that difference.Other Measures of DebtFour other measures are sometimes used in discussions of federal debt.Debt held by the publ

145、ic minus financial assets excludes the value of the governments financial assets.That measure reflects the governments overall financial condition by accounting for the value of financial assets,such as student loans,that the government has acquired while incurring that debt.In CBOs baseline project

146、ions,that measure generally varies along with debt held by the public but is 6percent to 8percent smaller.Debt held by the public minus financial assets and debt held by the Federal Reserve excludes the value of financial assets held by the federal government as well as Treasury securities held by t

147、he Federal Reserve.That measure represents the net debt held by entities outside the government,which better reflects the governments overall effect on credit markets.In CBOs baseline projections,that measure increases 5.For more details about other means of financing and about federal debt more bro

148、adly,see Congressional Budget Office,Federal Debt:A Primer(March2020),www.cbo.gov/publication/56165.14THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Table 1-3.CBOs Baseline Projections of Federal DebtBillions of dollarsActual,2023202420252026202720282029203020334Debt held by th

149、e public at the beginning of the year24,252 26,240 27,897 29,749 31,515 33,233 35,141 36,916 38,868 40,945 43,201 45,739Changes in debt held by the publicResulting from the deficit1,6951,5071,7721,6921,6401,8441,7231,9172,0542,2382,5562,579Resulting from other means of financinga292523523

150、18-18-18Total1,9871,6571,8521,7661,7181,9081,7751,9522,0772,2562,5382,561Debt held by the public at the end of the yearIn billions of dollars26,240 27,897 29,749 31,515 33,233 35,141 36,916 38,868 40,945 43,201 45,739 48,300As a percentage of GDP97.399.0101.7103.3104.7106.3107.4108.7110.2111.9114.01

151、16.0Addendum:Federal financial assetsb2,2032,3532,4332,5072,5852,6482,7002,7362,7582,7762,7582,740Debt minus financial assetsIn billions of dollars24,037 25,544 27,316 29,008 30,648 32,492 34,216 36,132 38,187 40,425 42,981 45,560As a percentage of GDP89.190.793.495.196.598.399.5101.1102.8104.7107.2

152、109.4Federal Reserves holdings of debt held by the public4,9584,3814,4144,9695,5776,1876,7187,2277,7418,2648,7819,304Debt minus financial assets and the Federal Reserves holdingsIn billions of dollars19,079 21,163 22,902 24,038 25,071 26,305 27,498 28,905 30,446 32,161 34,200 36,256As a percentage o

153、f GDP70.775.178.378.878.979.680.080.981.983.385.387.1Gross federal debtc32,988 34,825 36,775 38,624 40,243 42,021 43,702 45,460 47,294 49,255 51,718 54,386Debt subject to limitd33,070 34,906 36,853 38,701 40,319 42,098 43,778 45,535 47,369 49,330 51,791 54,459Average interest rate on debt held by th

154、e public(percent)2.73.33.43.43.33.33.33.33.43.53.53.5Data sources:Congressional Budget Office;Department of the Treasury.See www.cbo.gov/publication/59710#data.GDP=gross domestic product.a.Factors not included in budget totals that affect the governments need to borrow from the public.Those factors

155、include changes in the governments cash balances and cash flows associated with federal credit programs,such as those related to student loans.(The subsidy costs of those programs are reflected in the budget deficit.)b.The value of outstanding student loans and other credit transactions,cash balance

156、s,and various financial instruments.c.Federal debt held by the public plus Treasury securities held by federal trust funds and other government accounts.d.The amount of federal debt that is subject to the overall limit set in law.That measure of debt excludes debt issued by the Federal Financing Ban

157、k and reflects certain other adjustments that are excluded from gross federal debt.Currently,the statutory limit on the issuance of new federal debt is suspended through January 1,2025.In the absence of any legislative action on the debt limit before the suspension ends,the amount of borrowing accum

158、ulated during the suspension will be added to the previous debt limit of$31.4 trillion.The Deficit Control Act requires CBO to project spending,revenues,and deficits independently of the debt limit.For more details,see Congressional Budget Office,Federal Debt and the Statutory Limit,February 2023(Fe

159、bruary 2023),www.cbo.gov/publication/58906.15CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034from$19.1trillion(or 71percent of GDP)at the end of 2023 to$36.3trillion(or 87percent of GDP)at the end of 2034.(The Federal Reserves holdings of Treasury securities,which totaled$5.0

160、trillion at the end of 2023,are projected to fall to$4.4trillion at the end of 2024;thereafter,those holdings increase in CBOs projections,rising to$9.3trillion in 2034.)Gross debt consists of debt held by the public and Treasury securities held by government accounts(for example,the Social Security

161、 trust funds).The debt held by government accounts does not directly affect the economy and has no net effect on the budget.It is not a meaningful benchmark for Treasurys future obligations because it represents the cumulative difference between a programs past collections and expenditures.Although

162、debt held by the public increases by$22.1trillion from the end of 2023 to the end of 2034in CBOs baseline projections,debt held by government accounts falls by about$660billion,reflecting declines in the balances of many trust funds.As a result,gross federal debt is projected to rise by$21.4trillion

163、 over that period and to total$54.4trillion at the end of 2034.About 11percent of that sum would be debt held by government accounts.Debt subject to limit is the amount of debt that is subject to the statutory limit on federal borrowing,which is often referred to as the debt ceiling.Such debt differ

164、s from gross federal debt mainly in that it excludes debt issued by the Federal Financing Bank and includes certain other adjustments that are excluded from gross debt.6 Currently,the statutory limit on the issuance of new federal debt is suspended through January1,2025.In the absence of any legisla

165、tive action to adjust the debt limit before the suspension ends,the amount of borrowing accumulated during the suspension will be added to the previous debt limit of$31.4trillion.The Deficit Control Act requires that CBO project spending,revenues,and deficits independently of the debt limit.Thus,in

166、CBOs baseline projections,debt subject to limit continues rising over the next decade and reaches$54.5trillion in 2034.6.The Federal Financing Bank,a government corporation under the general supervision of the Treasury,assists federal agencies in managing their borrowing and lending programs.It can

167、issue up to$15billion of its own debt securities;that amount does not count against the debt limit.Figure 1-2.Federal Debt Held by the PublicPercentage of GDP Projected04080005200020252050Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.GDP=gross d

168、omestic product.Federal debt held by the public increases each year in CBOs projections,swelling to an all-time record of 116 percent of GDP in 2034.In the two decades that follow,growing deficits are projected to cause federal debt to soar to 172percent of GDP by 2054.16THE BUDGET AND ECONOMIC OUTL

169、OOK:2024 TO 2034 FEBRUARy 2024OutlaysIn CBOs baseline projections,outlays rise from 22.7percent of GDP in 2023 to 23.1percent in 2024 and remain near that level through 2028.Thereafter,outlays increase in each year as a share of the economy,reaching 24.1percent of GDP in 2034.Since 1974,outlays have

170、 averaged 21.0percent ofGDP.Outlays in 2024Federal outlays are projected to total$6.5trillion in 2024an increase of$0.4trillion(or 6percent)from the amount recorded in 2023.(If the budgetary effects related to the Administrations plan for student loan cancellations were excluded from last years tota

171、l,the projected increase in outlays would instead be 1percent.)In nominal terms,projected outlays rise this year in all three spending categoriesmandatory,discretionary,and net outlays for interestbut net outlays for interest and mandatory spending make up 96percent of the total increase.Mandatory S

172、pending.This category includes outlays for most federal benefit programs and for certain other pay-ments to people,businesses,nonprofit institutions,and state and local governments.Such outlays are generally governed by statutory criteria and are not normally con-strained by the annual appropriation

173、 process.7 Certain types of payments that federal agencies receive from the public and from other government agencies(such as premiums paid by Medicare beneficiaries and payments made by federal agencies to employees retirement plans)are classified as offsetting receipts and are accounted for in the

174、 budget as reductions in mandatory spending.The Deficit Control Act requires CBO to construct its baseline projections for most existing mandatory spending under the assumption that current laws generally remain in place.Therefore,CBOs baseline projections of man-datory spending reflect the estimate

175、d effects of changes in the economy,growth in the number of beneficiaries of certain mandatory programs,and other factors related to the costs of those programs.The projections also incor-porate a set of across-the-board reductions in budgetary 7.Each year,some mandatory programs are modified by pro

176、visions in annual appropriation acts.Such changes may increase or decrease spending for the affected programs for one or more years.In addition,spending for some mandatory programs(such as Medicaid and the Supplemental Nutrition Assistance Program)is considered mandatory,but benefits are paid from a

177、mounts provided in appropriation acts.resources(known as sequestration)that are required under current law for some mandatory programs.In 2024,CBO estimates,total mandatory outlays(net of offsetting receipts)will amount to$3.9trillion under current law,$166billion(or 4percent)more than they were in

178、2023(see Table 1-4).Those outlays are projected to amount to 13.9percent of GDP this yearequal to last years percentage but still well above the 11.0percent of GDP they averaged from 1974 to 2023.If the budget-ary effects of the Administrations plan for student loan cancellations were excluded from

179、2023totals,projected mandatory outlays this year would be$167billion less than they were in 2023.Outlays for these programs decrease the most in 2024in CBOs projections:Deposit insurance.Outlays of the Federal Deposit Insurance Corporation(FDIC)are projected to fall by$117billion this year as that a

180、gency continues to resolve the bank failures that occurred in 2023.This year(and over the next few years),the FDIC expects to recover much of what it spent to resolve those failures by liquidating the banks assets and collecting higher premiums from FDIC-insured institutions.CBO projects a reduced r

181、isk of bank failures in 2024relative to last years activity.Medicaid.CBOs updated baseline projections include a$58billion(or 9percent)drop in Medicaid outlays from 2023 to 2024.Two factors account for most of the reduction.First,states are continuing to reassess the eligibility of Medicaid enrollee

182、s who remained in the program during the coronavirus public health emergency.8 The Consolidated Appropriations Act,2023(P.L.117-328),ended the continuous-enrollment requirement on March31,2023,and states began to review enrollees eligibility and to disenroll those who no longer qualified.CBO expects

183、 Medicaid enrollment to fall in 2024as states continue that process.In addition,that law lowered the enhanced matching rate for federal reimbursement to states for Medicaid services from an average of 5percentage points in 2023 to 1.5percentage points 8.Provisions of the Families First Coronavirus R

184、esponse Act(P.L.116-127)required states to keep all Medicaid enrollees in the program until the coronavirus public health emergency ended.The declaration lifting that emergency took effect on May11,2023.17CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034in the first quarter of

185、 2024 and to zero thereafter,which decreases outlays for the program.Pension Benefit Guaranty Corporation.Net outlays for the Pension Benefit Guaranty Corporation(PBGC)are projected to decline by$32billion(or 80percent)in 2024,to$8billion.That decrease stems almost entirely from less spending for PB

186、GCs special financial assistance program,which makes onetime payments to financially troubled multiemployer pension plans that qualify for assistance.Refundable tax credits.Outlays for refundable tax credits total$118billion in 2024in CBOs projections,$26billion less than the amount recorded in 2023

187、.Outlays for the coronavirus refundable tax credits decline by$31billion in 2024.9 In the opposite direction,outlays for the earned income tax credit are projected to increase by$7billion this year because of higher wages and employment gains.Supplemental Nutrition Assistance Program.Outlays for the

188、 Supplemental Nutrition Assistance Program(SNAP)are projected to fall by$23billion(or 17percent)in 2024,to$112billion.That decrease largely stems from the end of pandemic-related benefits.Emergency allotments that were provided to SNAP participants during the pandemic ended in February2023,and CBO p

189、rojects that spending for the Pandemic Electronic Benefit Transfer Program,which provided food benefits to households with children,will end in 2024.Additionally,CBO projects that SNAP participation will decline by about 1million people this year,to 41.1million.The largest increases in estimated out

190、lays for 2024 are for these programs:Higher education.In CBOs baseline,projected outlays for higher education increase by$213billion this year,rising to$29billion from$183billion last year.In 2023,the Administration recorded a net reduction of$207billion in the costs of outstanding loansprimarily re

191、flecting the$333billion reduction in outlays that resulted from the Supreme Courts decision 9.The coronavirus refundable tax credits are a group of tax credits to help employers cover the costs of sick and family leave,employee retention,and continuation of health insurance for certain workers durin

192、g 2020 and 2021.Employers may continue to claim those temporary tax credits on their amended tax returns;CBO projects that those claims will decline over time.that blocked implementation of the Administrations plan to cancel outstanding student loans for many borrowers.About one-third of the$333bill

193、ion reduction was offset by increased outlays recorded for the new income-driven repayment plan implemented by the Administration($74billion)and for other modifications the Administration made to the terms of outstanding loans and to changes in the underlying assumptions about the costs of those loa

194、ns($52billion).Excluding those 2023revisions to the costs of outstanding loans,spending for higher education would have increased by$5billion from 2023 to 2024.Social Security.Outlays for Social Security are estimated to increase by$104billion(or 8percent)in 2024,to$1.5trillion.About$80billion of th

195、at growth stems from an increase in average benefits,most of which was driven by the 8.7percent cost-of-living adjustment(COLA)in January2023 and the 3.2percent COLA in January2024.A net increase in the total number of beneficiaries accounts for the remaining growth.Most of the projected increase in

196、 outlays$98billionis for the Old-Age and Survivors Insurance portion of Social Security.The rest is for the Disability Insurance portion of the program.Medicare.Outlays for Medicare(net of offsetting receipts)reach$896billion this year in CBOs projections,$65billion(or 8percent)more than in 2023.Tha

197、t increase is the net result of a$76billion increase in spending for benefits and a$12billion increase in offsetting receipts(mainly from the collection of premiums).The growth in Medicare benefit spending is mostly concentrated in larger payments to Medicare Advantage plans(which allow beneficiarie

198、s to receive their Medicare coverage through private plans)and to Part D plans(which cover outpatient prescription drugs).Projected growth in payments for the traditional Medicare fee-for-service program is slower this year because of continued growth in Medicare Advantage enrollment:CBO expects tot

199、al Medicare enrollment to increase by 1million in 2024,which reflects an increase of 2million in enrollment in Medicare Advantage and a decrease of 1million in enrollment in Medicare fee-for-service.Veterans programs.In CBOs projections,mandatory outlays for veterans programs increase by$27billion(o

200、r 16percent)in 2024,to$195billion.Most of that increase stems from growth in the amount of disability compensation payments that some veterans receive.(Average disability ratings 18THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Table 1-4.CBOs Baseline Projections of Mandatory Outlays,Adju

201、sted to Exclude Effects of Timing Shifts Billions of dollarsTotalActual,2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 20342025 20292025 2034Social SecurityOld-Age and Survivors Insurance1,198 1,296 1,381 1,466 1,550 1,642 1,734 1,829 1,927 2,026 2,127 2,2307,772 17,911Disability Insurance15

202、04102,011Subtotal1,348 1,453 1,545 1,640 1,734 1,832 1,930 2,032 2,137 2,245 2,355 2,4718,682 19,922Major health care programsMedicarea,b1,009 1,085 1,152 1,223 1,314 1,407 1,507 1,617 1,733 1,859 2,008 2,1616,604 15,983Medicaid667658068538983,0

203、987,148Premium tax credits and related spending c9959911294821,056Childrens Health Insurance Program0202191Subtotal1,733 1,763 1,831 1,912 2,043 2,177 2,317 2,469 2,626 2,801 2,999 3,203 10,280 24,378Income security programsSupplemental Nutrition Assistanc

204、e Program9435561,148Earned income,child,and other tax credits d28687878888898989477918Supplemental Security Income a6062646567697335720Unemployment compensation3040454547495238520Child nutrition34040408Family sup

205、port and foster care e494535363737383838393940183378Subtotal44840740239238539240040641,9704,091Federal civilian and military retirementCivilian f8317071,516Military a7479828588904106439943Subtotal32302362422482552642702771,1452,459Vet

206、erans programsIncome securitya,g62092222332432542652762881,0442,370Toxic exposures fund h174450Othera,i8185186Subtotal083243403573731,3033,006Other programsHigher education-335152318Agriculture 2627222

207、323232424216Deposit insurance91-26-20-12-9-61-12-13-13-14-14-15-115-183MERHCF4869154Fannie Mae and Freddie Maci003466666610102564Pension Benefit Guaranty Corporation408-2*-3-4-4-4-4-5-5-5-13-37Education Stabilization Fund4538236000000002929Other71511501441

208、33611,311Subtotal0251,0221,871Mandatory outlays,excluding offsetting receipts4,085 4,264 4,438 4,638 4,866 5,074 5,386 5,656 5,940 6,235 6,574 6,920 24,402 55,727Continued19CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034TotalActual

209、,2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 20342025 20292025 2034Offsetting receiptsMedicare-177-189-212-221-241-261-282-307-333-361-393-422-1,218-3,032Federal share of federal employees retirementCivil service retirement and other-55-57-60-63-65-68-70-72-75-77-79-80-326-708Military ret

210、irement-27-24-22-23-23-24-24-25-26-26-27-28-116-248Social Security-22-23-23-24-25-26-26-27-28-29-30-31-125-269Subtotal-104-104-105-109-113-117-121-125-128-132-136-138-566-1,225Receipts related to natural resources-20-18-18-18-17-17-18-18-18-18-19-19-89-180MERHCF-10-11-12-12-13-13-14-15-15-16-17-18-6

211、4-144Fannie Mae and Freddie Mac j-6-6000000000000Other-26-28-30-31-33-34-32-38-39-26-26-26-160-315Total-343-356-377-392-418-443-466-502-533-553-590-622-2,096-4,897Mandatory outlays,including offsetting receipts3,742 3,908 4,061 4,246 4,448 4,632 4,919 5,153 5,407 5,682 5,984 6,298 22,306 50,830Effec

212、ts that timing shifts have on mandatory outlays in CBOs baseline projectionsMedicare7-4n.a.n.a.Supplemental Security Income*-50005-50006*n.a.n.a.Military retirement1-n.a.n.a.Veterans income security3-1n.a.n.a.Veterans other*-10001-10001*n.a.n.a.Total 11-70

213、2n.a.n.a.Mandatory outlays in CBOs baseline projections3,753 3,838 4,061 4,246 4,448 4,743 4,807 5,153 5,407 5,682 6,131 6,320 22,306 50,999Addendum:Outlays,net of offsetting receiptsMedicare832896940 1,001 1,074 1,146 1,225 1,310 1,400 1,498 1,616 1,7405,386 12,951Major health care

214、 programs1,556 1,574 1,619 1,691 1,802 1,915 2,035 2,162 2,294 2,440 2,606 2,7819,062 21,346Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.Spending for benefit programs shown in this table generally excludes administrative costs,which are discretionary.MERHCF=Departme

215、nt of Defense Medicare-Eligible Retiree Health Care Fund;n.a.=not applicable;*=between zero and$500 million.a.When October 1(the first day of the fiscal year)falls on a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shi

216、fted into the previous fiscal year.Outlays have been adjusted to remove the effects of those timing shifts.b.Gross spending,excluding the effects of Medicare premiums and other offsetting receipts.(Net Medicare spending is shown in the addendum section.)c.Spending to subsidize health insurance purch

217、ased through the marketplaces established under the Affordable Care Act and provided through the Basic Health Program and spending to stabilize premiums for health insurance purchased by individuals and small employers.d.Includes outlays for the American Opportunity Tax Credit and other credits.e.In

218、cludes Temporary Assistance for Needy Families,Child Support Enforcement,Child Care Entitlement to States,and other programs that benefit children.f.Includes benefits for retirement programs in the civil service,foreign service,and Coast Guard;benefits for smaller retirement programs;and annuitants

219、health care benefits.g.Includes veterans compensation,pensions,and life insurance programs.h.Provides funding for health care,claims processing,and certain other incidental expenses related to providing care to veterans exposed to toxic substances.i.Primarily the GI Bill and similar education benefi

220、ts.j.Cash payments from Fannie Mae and Freddie Mac to the Treasury are recorded as offsetting receipts in 2023 and 2024.Beginning in 2025,CBOs estimates reflect the net lifetime coststhat is,the subsidy costs adjusted for market riskof the guarantees that those entities will issue and of the loans t

221、hat they will hold.CBO counts those costs as federal outlays in the year of issuance.Table 1-4.ContinuedCBOs Baseline Projections of Mandatory Outlays,Adjusted to Exclude Effects of Timing Shifts Billions of dollars20THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024for veterans continue to

222、rise,which results in larger benefit payments.)The number of new veterans receiving disability compensation is also expected to increase this year,in part from continued implementation of provisions of the Honoring our PACT Act of 2022(P.L.117-168).In addition,outlays for veterans benefits grow as a

223、 result of the COLAs that went into effect in January2023 and 20248.7percent and 3.2percent,respectively.Taken together,outlays for all other mandatory pro-gramsincluding federal retirement programs and subsi-dies for health insuranceare estimated to rise,on net,by$13billion(or 0.3percent)in 2024.Di

224、scretionary Spending.This category encompasses spending for an array of federal activities that are funded through or controlled by appropriations.Discretionary spending includes most defense spending;spending for many nondefense activities,such as elementary and secondary education,housing assistan

225、ce,international affairs,and the administration of justice;and outlays for certain transportation programs(though funding for those programs is mandatory).In any year,some discre-tionary outlays arise from budget authority provided in the same year,and some arise from appropriations made in previous

226、 years.10In CBOs projections,discretionary funding and discre-tionary outlays each total$1.7trillion this year.Relative to amounts provided last year,this years funding is lower,but outlays are projected to be$17billion more.The agency projects outlays to increase this year despite the reduction in

227、budget authority primarily because of spending from budget authority provided in previous years.CBOs baseline projections of discretionary spending reflect laws that were in place as of January3,2024.The continuing resolution then in effect(the Further Continuing Appropriations and Other Extensions

228、Act,2024)provided funding through January19 for some federal agencies and through February2 for the rest.CBOs baseline incorporates the funding provided by that continuing resolution on an annualized basisthat is,calculated as if the funding provided by the con-tinuing resolution was in effect for t

229、he entire fiscal year.Because the resulting amounts exceed the limits on 10.Budget authority,or funding,is the authority provided by federal law to incur financial obligations that will result in immediate or future outlays of federal government funds.discretionary funding for 2024established by the

230、 Fiscal Responsibility Act,the total amount of budget authority and the resulting outlays have been adjusted to comply with those limits,or caps.(See Box 1-1 for details about the FRAs effects on CBOs baseline projections of discre-tionary spending.)Some discretionary funding in CBOs baseline is not

231、 constrained by the limits set in the FRA.Current law allows adjustments to be made to the caps for certain funding designated as an emergency requirement or(within statutory limits)for disaster relief activities,some efforts to reduce overpayments in benefit programs,and wildfire suppression.Other

232、funding is exempt from the caps altogether.Specifically,certain funding provided pursuant to the 21st Century Cures Act(P.L.114-255),funding derived from the Harbor Maintenance Trust Fund,and emergency funding covered by section 103 of the FRA does not count toward the caps.11 Funding that does not

233、fall into any of those categories(and is therefore constrained by the caps)is referred to as“base”funding.In CBOs baseline projections,discretionary budget authority for 2024 is$122billion(or 7percent)less than the amount provided in 2023(see Table 1-5).(Budget authority does not include obligation

234、limitations that govern discretionary spending for certain transpor-tation programs whose spending authority is manda-tory;the limitations are the same under the continuing resolution this year as they were last year.)12 The amount of base funding in CBOs baseline is$1.6trillion in 2024,generally re

235、flecting the limits set in section 102 of the FRA.13(Total base funding for 2024in CBOs baseline differs from the funding reported in CBOs cost estimate for the continuing resolution by$37billion.11.Funding covered by section 103 of the FRA stems from division J of the Infrastructure Investment and

236、Jobs Act,division B of the Bipartisan Safer Communities Act,and section 443 of division G of the Consolidated Appropriations Act,2023(which permanently appropriates as an emergency requirement funds collected by the Hazardous Substance Superfund).12.An obligation limitation is a restrictiontypically

237、 included in an appropriation acton the amount,purpose,or period of availability of spending authority.The limitation often affects budget authority that has been provided in an authorization act.Although the budget authority for many transportation programs is mandatory,the outlays from the obligat

238、ion limitations for those programs are considered discretionary.13.Although some funding is not constrained by the caps,that funding could be reduced under statutory procedures used to enforce the caps.21CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034For an explanation,see B

239、ox 1-2 on page 24.)Budget authority that is not constrained by the caps totals$127billion this year.More than half of that amount was provided by the Infrastructure Investment and Jobs Act(P.L.117-58)and the Bipartisan Safer Communities Act(P.L.117-159),both of which were enacted in 2022.Discretiona

240、ry budget authority for defense totals$850billion in 2024,a$42billionor 5percentreduction from the amount provided in 2023.Last year,$33billion in funding designated as an emergency requirement was provided,mostly for military assistance to Ukraine.As of January3,2024,no such funding had been provid

241、ed for 2024.The reduction in base funding,which stems from the cap on defense funding,accounts for the rest of the difference.Outlays for defense are pro-jected to be$822billion in 2024,which is$17billion(or 2percent)more than such outlays were in 2023.From 2023 to 2024,total funding for nondefense

242、discretionary programs decreases by$81billionor 8percentin CBOs projections,to$876billion.Nondefense base funding accounts for$40billion of that reduction,driven largely by the cap on such fund-ing.In addition,funding designated as an emergency requirement that results in an upward adjustment to the

243、 Table 1-5.Changes in Discretionary Budget Authority From 2023 to 2024Billions of dollarsActual,2023aEstimated,2024ChangePercentage changeDefenseBase funding b858850-9-1.0Emergency funding not subject to the caps c*00Emergency funding resulting in cap adjustmentsd330-33-100.0Other nonbase funding000

244、n.a.Subtotal891850-42-4.7NondefenseBase funding b789750-40-5.0Emergency funding not subject to the capsc707110.8Emergency funding resulting in cap adjustments d6928-41-59.5Other nonbase funding2828-1-2.4Subtotal957876-81-8.5Total discretionary budget authorityBase funding b1,6481,599-48-2.9Emergency

245、 funding not subject to the caps c707110.8Emergency funding resulting in cap adjustments d10228-74-72.6Other nonbase funding2828-1-2.4Total1,8481,726-122-6.6Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.This table does not include obligation limitations for certain t

246、ransportation programs.FRA=Fiscal Responsibility Act;*=between zero and$500 million.a.Shows amounts for each category of funding had the FRA been in place in 2023.b.Consists of all discretionary appropriations except those that have been designated as an emergency requirement or for disaster assista

247、nce,certain program integrity activities(which identify and reduce overpayments in some benefit programs),certain fire suppression operations,certain funding derived from the Harbor Maintenance Trust Fund,and programs designated in the 21st Century Cures Act.Funding in this category is subject to th

248、e caps established by sections 101 and 102 of the FRA,which were not in effect in 2023.c.Consists almost entirely of funding designated as an emergency requirement provided by division J of the Infrastructure Investment and Jobs Act,division B of the Bipartisan Safer Communities Act,and section 443

249、of division G of the Consolidated Appropriations Act,2023.Section 103 of the FRA stipulated that such funding does not count toward the caps.d.Consists of funding,designated as an emergency requirement in keeping with section 251 of the Deficit Control Act,that changes the level of the caps.22THE BU

250、DGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Box 1-1.How the Fiscal Responsibility Act Affects CBOs Baseline Projections of Discretionary FundingTwo separate sections of the Fiscal Responsibility Act of 2023(FRA,Public Law118-5)established differing limitsalso known as capson both defense dis

251、cretionary funding and nondefense discretionary funding for 2024 and 2025.Which section of the law applies depends on the timing of the enactment of appropriations and the duration of funding.1 Caps established by section 101 of the FRA apply at the start of each fiscal year.But if a continuing reso

252、lution is still in effect on January1 of that same fiscal year,those caps will be replaced by the limits established in section 102 of the FRA.(If full-year appropriations are enacted after January1,the limits will revert to the caps under section 101 of the law.)The caps on defense and nondefense f

253、unding limit mostbut not alldiscretionary funding.Some funding designated for certain purposes causes an adjustment to the caps,and certain other funding is not subject to the caps at all.Because amounts appropriated for those purposes are generally not constrained by the caps,the Congressional Budg

254、et Office projects such funding in accordance with the provisions of the Balanced Budget and Emergency Deficit Control Act of 1985that is,by assuming that appropriations in future years are equal to the amounts provided for the current year with increases for inflation.(Funding for certain types of

255、activities that result in adjustments to the caps is subject to separate caps.)CBOs baseline includes downward adjustments to projected discretionary funding to reflect the effects of the caps.For 2024,because a continuing resolution was in place on January1,the baseline reflects the caps under sect

256、ion 102 of the FRA,which are$850billion for defense funding and$736billion for nondefense funding.Those amounts are below the amounts CBO estimated in its cost estimate for the continuing resolution underlying the projections in this report 1.For more information,see Congressional Budget Office,lett

257、er to the Honorable Jodey Arrington and the Honorable Brendan Boyle regarding implementing the statutory limits on discretionary funding for fiscal year 2024(January 4,2024),www.cbo.gov/publication/59861.by$10billion and$41billion,respectively.2 Because cost esti-mates for appropriation legislationn

258、ot the baselineare used when enforcing the caps,CBOs baseline reflects downward adjustments of those amounts in 2024(see the table).(Differ-ences between funding projected in the baseline and funding reported in the cost estimate for the continuing resolution cause total base fundingthat is,funding

259、constrained by the capsin the baseline to exceed the caps.)3For 2025,CBOs baseline reflects the caps established under section 101 of the FRA,which are$895billion for defense funding(an increase from the cap now in effect for 2024)and$711billion for nondefense funding(a decrease from the 2024cap now

260、 in effect).Because the amount of base funding projected for defense in 2025 is below the cap,no additional adjustments to projections of that funding in 2025 are required;base defense funding for 2025 and beyond is therefore projected by carrying forward the base funding for 2024,with adjustments f

261、or inflation.Thus,base defense funding in the baseline over the next several years is$10billion to$11billion less than the amounts that would be projected without account-ing for the caps.Projected base funding for nondefense activities exceeds the section 101cap by$100billion in 2025,in CBOs estima

262、tion,so the agency has included reductions of that amount to bring such funding in the baseline into compliance with the 2025cap.Thus,projected base funding in the baseline matches the cap in 2025$711billionand the baseline incorporates the assump-tion that base nondefense funding will equal that am

263、ount(with increases for inflation)in each year from 2026 through 2034.If not for the caps,beginning in 2025,base nondefense funding would exceed amounts projected in CBOs baseline by more than$100billion each year.2.Congressional Budget Office,cost estimate for H.R.6363,the Further Continuing Approp

264、riations and Other Extensions Act,2024(November13,2023),www.cbo.gov/publication/59755.3.For details about differences between CBOs cost estimate for the continuing resolution and total funding in the agencys baseline,see Box 1-2.Continued23CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:

265、2024 TO 2034Box 1-1.ContinuedHow the Fiscal Responsibility Act Affects CBOs Baseline Projections of Discretionary FundingDiscretionary Funding Projected in CBOs BaselineBillions of dollars202420252026202720282029Projected base funding without accounting for the capsDefense8608866Nondefens

266、e7908886Total1,6501,6921,7331,7731,8091,851Caps in section 102 of the Budget Control Act,as amended (currently apply in 2024)Defense850850n.a.n.a.n.a.n.a.Nondefense736736n.a.n.a.n.a.n.a.Total1,5861,586n.a.n.a.n.a.n.a.Caps in section 101 of the Budget Control Act,as amended(currently apply

267、 in 2025)Defense886895n.a.n.a.n.a.n.a.Nondefense704711n.a.n.a.n.a.n.a.Total1,5901,606n.a.n.a.n.a.n.a.Effects of the caps on CBOs projections of base fundingDefense-10-10-10-11-11-11Nondefense-41-100-103-105-107-109Total-51-110-113-116-118-121Projected base funding after accounting for the capsDefens

268、e8508754Nondefense7507776Total1,5991,5821,6201,6571,6911,731Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.Shaded cells reflect which sets of caps CBO used when constructing its baseline.Base funding is funding that is not designated as an emerge

269、ncy requirement or for disaster relief,certain program integrity activities,certain fire suppression operations,certain funding derived from the Harbor Maintenance Trust Fund,and certain programs designated in the 21st Century Cures Act.The amount of budget authority in CBOs baseline that is constra

270、ined by the caps does not match the level of the caps in 2024 because cost estimates for appropriation legislationnot the baselineare used when enforcing the caps.Therefore,the downward adjustments in CBOs baseline reflect the differences between the caps on base funding and the agencys estimates fo

271、r base funding provided by the continuing resolution in place on January 3,2024.For more on why CBOs cost estimate of that continuing resolution and funding in the agencys baseline differ,see Box 1-2.n.a.=not applicable.24THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Box 1-2.Why CBOs Bas

272、eline Projections of Discretionary Funding for 2024Differ From Amounts in Its Cost Estimate for the Continuing ResolutionDiscretionary funding provided for 2024in the Congressional Budget Offices current baseline is$35billion less than the amount shown in CBOs cost estimate for the Further Continuin

273、g Appropriations and Other Extensions Act(Public Law118-22),referred to here as the continuing resolution.1 That difference occurs for several reasons(see the table).Major Reasons for the DifferenceThe largest driver of the difference between the amounts projected in the baseline and CBOs cost estim

274、ate for the continuing resolution arises from the estimated effects of the Fiscal Responsibility Act of 2023(P.L.118-5),which limits federal funding for discretionary programs over the current and next fiscal year.When the amounts provided by the continuing res-olution are annualizedthat is,calculat

275、ed as if the law was in effect through all of 2024funding provided for 2024exceeds those limits.As a result,CBO has adjusted the total amount of funding to reflect the expectation that the Administration would implement statutory mechanisms to enforce the caps.In total,those adjustments reduce discr

276、etionary funding shown in the baseline by$51billion in relation to the funding totals shown in the cost estimate for the continuing resolution.2 Another reason for the difference stems from changes in mandatory programs enacted in appropriation acts,which are known as CHIMPs.Following rules(known as

277、 scorekeeping guidelines)that govern how CBO produces its cost estimates,1.Congressional Budget Office,cost estimate for H.R.6363,the Further Continuing Appropriations and Other Extensions Act,2024(November13,2023),www.cbo.gov/publication/59755.2.For more information about how the caps may affect di

278、scretionary resources in 2024,see Congressional Budget Office,letter to the Honorable Jodey Arrington and the Honorable Brendan Boyle regarding implementing the statutory limits on discretionary funding for fiscal year 2024(January 4,2024),www.cbo.gov/publication/59861.Although the adjustments in CB

279、Os baseline affect only discretionary funding that is constrained by the caps(“base funding”in the table),statutory enforcement procedures eventually would affect most funding not constrained by the caps.The total effect of those procedures would still amount to approximately$51 billion.such changes

280、 made in appropriation acts are classified as reductions or increases in discretionary spending in cost estimates.When CBO produces its baseline estimates,though,those CHIMPs are reflected as reductions or increases in mandatory spending,following the scorekeeping guidelines that govern their classi

281、fication.3 On net,CHIMPs reduced CBOs estimate of discretionary funding in its cost estimate for the continuing resolution by$15billion.Shifting the effect of that reduction to CBOs projections of mandatory spending boosts net discretionary funding by the same amount.Other ReasonsTechnical and econo

282、mic updates to estimated components of discretionary funding also account for part of the difference.For example,some fees that agencies collect(for mortgage originations guaranteed by the Federal Housing Administration or aviation security fees collected by the Transportation Security Administratio

283、n,for instance)are estimated and are classified as offsets to discretionary budget authority.CBOs estimate for the continuing resolution used amounts projected in its May2023baseline,but updated estimates of that funding in CBOs most recent baseline result in larger estimates of fees.As a result,net

284、 discretionary budget authority in the baseline is$3billion smaller than the amount in CBOs estimate for the continuing resolution.In addition,current law requires CBO to exclude some discretionary funding from its cost estimates.Specifically,the 21st Century Cures Act(P.L.114-255)and division B of

285、the CARES Act(P.L.116-136,as amended)require that certain fund-ing provided to the National Institutes of Health and the Food and Drug Administration or derived from the Harbor Mainte-nance Trust Fund be excluded from CBOs cost estimates.That funding is reflected in CBOs baseline,however,accounting

286、for another$3billion of the overall difference.3.For more information about the guidelines,see Congressional Budget Office,CBO Explains Budgetary Scorekeeping Guidelines(January 2021),www.cbo.gov/publication/56507.Continued25CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034Fin

287、ally,when estimating the amount of funding provided by the continuing resolution,CBO was directed by the House and Senate Budget Committees to incorporate the assumption that certain funding provided to the federal power marketing administrations(federal agencies that generate power)would be fully o

288、ffset by the fees those agencies collect.(Those fees reduce total budget authority.)Because CBOs baseline does not reflect that assump-tion,its discretionary budget authority is$0.1billion larger than the amount in the cost estimate.Box 1-2.ContinuedWhy CBOs Baseline Projections of Discretionary Fun

289、ding for 2024Differ From Amounts in Its Cost Estimate for the Continuing ResolutionSources of Differences Between CBOs Estimate of Discretionary Funding Provided for 2024 in Appropriation Legislation and 2024 Discretionary Funding in the BaselineBillions of dollarsDefense fundingNondefense fundingTo

290、tal fundingBase aNonbaseBase aNonbaseAmount of funding shown in cost estimate for the continuing resolution860*7771241,761DifferencesEffect of FRA caps b-100-410-51CHIMPs c0016*15Changes to estimated accounts d*0-2*-3Certain funding excluded from estimate e00033Directed scoring f00*0*Total differenc

291、e-100-272-35Funding in baseline850*7501271,726Data source:Congressional Budget Office.See www.cbo.gov/publication/59710#data.CHIMPs=changes to mandatory programs;FRA=Fiscal Responsibility Act;*=between-$500 million and$500 million.a.Base funding is funding that is not designated as an emergency requ

292、irement or for disaster relief,certain program integrity activities,certain fire suppression operations,certain funding derived from the Harbor Maintenance Trust Fund,and certain programs designated in the 21st Century Cures Act.b.The FRA(Public Law 118-5)established limits on discretionary budget a

293、uthority.P.L.118-22,the continuing resolution in effect when CBO completed its analysis,provided funding at annualized levels in excess of the limits under section 102 of that law,which were in place at that time.CBOs baseline includes downward adjustments to funding to reflect the eventual effect o

294、f those limits.(See Box 1-1 on page 22 for more information.)c.When appropriation acts make changes to mandatory programs,those changes are recorded as discretionary costs or savings pursuant to Congressional scorekeeping guidelines.When those changes are reflected in CBOs baseline,they appear as ma

295、ndatory spending.d.Budget authority for some discretionary accounts is estimated.For example,the total amount of fees collected by the Transportation Security Administration(TSA)is not specified in appropriation acts because that amount is generally determined by the total number of air passengers.C

296、urrent law requires those collections to be credited against appropriations made to the TSA.e.Current law requires certain funding derived from the Harbor Maintenance Trust Fund or for certain programs designated in the 21st Century Cures Act be excluded from CBOs cost estimates.That spending is ult

297、imately reflected in the baseline.f.The budget committees directed CBO,in its cost estimate for H.R.6363,to assume that certain spending would be fully offset by collections not reflected in the baseline.26THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024cap is$41billion less than it was la

298、st year.14 Despite the drop in funding,nondefense discretionary outlays in 2024 are projected to total the same amount as was recorded in 2023$917billionprimarily because of spending from budget authority provided in previous years.Net Interest Outlays.In the budget,net outlays for interest consist

299、of the governments interest payments on federal debt,offset by interest income that the govern-ment receives.Net interest outlays are dominated by the interest paid to holders of the debt that the Treasury issues to the public.The Treasury also pays interest on debt issued to trust funds and other g

300、overnment accounts,but such payments are intragovernmental transactions that have no effect on the budget deficit.Net outlays for interest have risen by more than 35per-cent in each of the past two years and are projected to increase by 32percent this year.In CBOs projections,those outlays rise from

301、$659billion in 2023 to$870bil-lion in 2024,surpassing discretionary outlays for defense this year.Relative to the size of the economy,net outlays for interest rise from 2.4percent in 2023 to 3.1percent in 2024double the 1.5percent of GDP recorded for such outlays in 2021.The projected increase in 20

302、24occurs primarily because the average interest rate that the Treasury pays on its debt is higher this year and is expected to rise further as maturing securities are refinanced at rates that exceed those that prevailed when the securities were issued.15 For example,the interest rate on 10-year Trea

303、sury notes averaged 3.0percent in 2022 and 4.0percent in 2023;that rate averages 4.6percent in 2024in CBOs current economic forecast(see Chapter2).Debt held by the public(in nominal terms,rather than as a percentage of GDP)is on track to increase by 6percent from 2023 to 2024,which also boosts net i

304、nterest payments this year.Outlays From 2025 to 2034In CBOs baseline projections,federal outlays(adjusted to exclude the effects of timing shifts)rise from 14.Funding that is designated in keeping with the Deficit Control Act as an emergency requirement raises the caps by the amount of funding provi

305、ded.Section 103 of the FRA stipulated that discretionary emergency-designated funding provided by the Infrastructure Investment and Jobs Act,the Bipartisan Safer Communities Act,and section 443 of the Consolidated Appropriations Act,2023,does not count toward the caps.15.The average interest rate on

306、 debt reflects the interest rates on Treasury securities of different maturities,the maturity structure of securities issued,and the costs of inflation-linked payments made on some of those securities.$6.8trillion in 2025 to$10.0trillion in 2034,for an average annual increase of 4.5percent.16 Measur

307、ed in relation to the size of the economy,federal out-lays remain around 23percent of GDP for several years before gradually rising,reaching 24.1percent in 2034(see Figure 1-3).Mandatory Spending.In CBOs projections,nominal outlays for mandatory programs(net of offsetting receipts)rise at an average

308、 annual rate of 5percent over the 20252034period.In relation to GDP,those outlays increase from 13.9percent in 2025 to 15.1percent in 2034.At that point,they would be about 4percentage points higher than the average over the past 50years(see Figure 1-4).Two underlying trends,the aging of the populat

309、ion and growth in federal health care costs per beneficiary,put upward pressure on mandatory outlays.The aging of the population causes the number of benefi-ciaries of Social Security and Medicare to grow faster than the overall population,and federal costs per beneficiary for the major health care

310、programs continue to rise faster than GDP per person.(Spending for the major health care pro-grams consists of outlays for Medicare,Medicaid,and the Childrens Health Insurance Program,as well as premium tax credits for health insurance purchased through the marketplaces established under the Afforda

311、ble Care Act and related spending.The premium tax credits subsidize the purchase of health insurance.)As a result of those two trends,outlays for Social Security and Medicare increase in relation to GDP from 2025 to 2034.Beyond the 10-year period,the effects of those trends on federal spending persi

312、st,particularly for Medicare.16.CBOs projections follow provisions in section 257 of the Deficit Control Act,which requires CBO to project spending for certain programs,including Social Security and Medicare,under the assumption that they will be fully funded,and thus able to make all scheduled paym

313、ents,even if the trust funds associated with those programs do not have sufficient resources to make full payments.For example,CBO estimates that the Highway Trust Fund will be exhausted in 2028 and the Old-Age and Survivors Insurance Trust Fund will be exhausted in 2033.Nevertheless,CBOs baseline p

314、rojections reflect the assumption that funding will be adequate to make full payments as required by law.In addition,the Deficit Control Act requires CBO to project spending for certain mandatory programs beyond their scheduled expiration.Other rules that govern the construction of CBOs baseline pro

315、jections have been developed by the agency in consultation with the House and Senate Budget Committees.For further details,see Congressional Budget Office,CBO Explains How It Develops the Budget Baseline(April2023),www.cbo.gov/publication/58916,and CBO Explains the Statutory Foundations of Its Budge

316、t Baseline(May2023),www.cbo.gov/publication/58955.27CHAPTER1:THE BUDGET OUTLOOK THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034Social Security and the Major Health Care Programs.Measured as a percentage of GDP,outlays for Social Security and the major health care programs,net of off-setting receipts,ar

317、e projected to rise in each year of the 10-year period,from 10.8percent in 2025 to 12.6per-cent in 2034.17 CBOs current baseline includes the following projec-tions for specific programs:Outlays for Social Security increase to 5.3percent of GDP in 2025 and continue rising thereafter,reaching 5.9perc

318、ent of GDP in 2034.Outlays for Medicare equal 3.2percent of GDP in 2025 and climb to 4.2percent of GDP in 2034.Federal outlays for Medicaid dip slightlyto 1.9percent of GDPin 2025 as pandemic-related spending ends and remain there through 2027.Thereafter,Medicaid outlays gradually climb to 2.2 perce

319、nt of GDP in 2034.Outlays for premium tax credits for health insurance purchased through the marketplaces established under the Affordable Care Act and related spending 17.Offsetting receipts for Medicare mostly consist of payments of premiums,recoveries of overpayments made to providers,and amounts

320、 paid by states from savings on Medicaids prescription drug costs.average 0.3percent of GDP per year through 2034,and outlays for the Childrens Health Insurance Program average 0.1percent.Other Mandatory Programs.Spending for programs other than Social Security and the major health care pro-grams is

321、 projected to equal 3.1percent of GDP in 2025.Such spending includes outlays for income support pro-grams(such as unemployment compensation and SNAP),military and civilian retirement programs,most veterans benefits,and major agriculture programs.That spending also includes offsetting receipts(other

322、than those related to Medicare)collected by the federal government.In CBOs baseline projections,other mandatory spend-ing measured relative to GDP generally declines after 2025,falling to 2.5percent at the end of the projection period.(That spending,including substantial outlays in response to the p

323、andemic,peaked at 10.5percent of GDP in 2021.)The projected decline occurs in part because benefit amounts for many of those programs are adjusted for inflation each year,and in CBOs economic forecast,the growth of nominal GDP outpaces inflation.Growth in veterans benefits,which averages 6percent pe

324、r year(in nominal terms)after 2024,partially offsets the decline in other mandatory outlays.Figure 1-3.Total Federal Outlays and RevenuesPercentage of GDP Projected17.924.9744201420242034RevenuesAverage revenues,1974 to 2023(17.3)Average outlays,1974 to 2023(21.0)OutlaysData so

325、urce:Congressional Budget Office.See www.cbo.gov/publication/59710#data.When October 1(the first day of the fiscal year)falls on a weekend,certain payments that would have ordinarily been made on that day are instead made at the end of September and thus are shifted into the previous fiscal year.All

326、 projections presented here have been adjusted to exclude the effects of those timing shifts.Historical amounts have been adjusted as far back as the available data will allow.GDP=gross domestic product.Measured as a percentage of GDP,projected outlays remain about the same for the next several year

327、s as growth in outlays for interest payments is offset by decreases in discretionary spending.Over the 20242034 period,outlays exceed their 50-year average by more than revenues exceed their historical average.28THE BUDGET AND ECONOMIC OUTLOOK:2024 TO 2034 FEBRUARy 2024Discretionary Spending.In acco

328、rdance with section 257 of the Deficit Control Act,discretionary funding in future years is assumed to equal the amount provided so far for 2024including funding designated as an emer-gency requirementwith adjustments for inflation.18 When the projected amounts exceed the limits estab-lished by the

329、FRA,the total amount of budget author-ity in CBOs baseline is adjusted to comply with those limits.Those adjustments are incorporated in CBOs projections of discretionary funding in future years.Total discretionary budget authority projected for 2025amounts to$1.7trillion(see Table 1-6).Defense 18.T

330、he Deficit Control Act specifies which measures of inflation CBO should use to construct its projections:The employment cost index for wages and salaries of workers in private industry is used to adjust discretionary funding related to federal personnel,and the gross domestic product price index is

331、used to adjust other discretionary funding.For accounts with enacted advance appropriations,CBO projected future discretionary funding for those years for which funding has not been provided,starting with existing appropriations and adjusting those amounts for inflation.funding subject to the caps i

332、s projected to total$871bil-lion,which is below the current limit of$895 billion for that year.Nondefense funding constrained by the caps is limited to$711billion,the amount of the cap currently in place for 2025.Funding not constrained by the capsmostly funding designated as an emergency requiremen

333、tis projected to total$127billion in 2025;all but$20million of that funding is for nondefense programs.In 2025,discretionary outlayswhich are projected to total$1.8trillionexceed total funding provided for the year,largely as a result of spending from budget authority provided in previous years.After 2025,when the caps are no longer in effect,total discretionary budget authority rises by an averag