CBO releases economic outlook summary
The federal budget deficit will increase this year, in relation to the size of the economy, for the first time since 2009, according to a summary of the Congressional Budget Office's 10-year Budget and Economic Outlook (PDF) released Jan. 19.
The summary was released early to help members of Congress as they work to resolve issues related to the 2017 budget, according to the CBO. The office will release the full report Jan. 25.
The 2016 deficit will be $544 billion, the CBO estimates. Federal outlays are projected to increase by 6%, to $3.9 trillion, or 21.2% of the gross domestic product, according to the summary.
Mandatory outlays will be $168 billion higher in 2016 than they were in 2015. Of that amount, Social Security outlays are expected to increase by about $28 billion (3%), accounting for one-sixth of the growth in mandatory spending projected for 2016.
Federal spending for the major healthcare programs will account for more than 60% of the projected growth in mandatory spending, according to the CBO. Combined, outlays for Medicare, Medicaid and the Children's Health Insurance Program, plus Affordable Care Act subsidies and related spending, are expected to be $104 billion (11%) higher in 2016 than they were in 2015, the office predicts.
The economy will grow more quickly in 2016 and 2017 than it did in 2015, but after than will grow at a moderate pace, constrained by relatively slow growth in the labor force, according to the CBO.
The office will issue its next set of budget projections in March.