How the Fiscal Responsibility Act of 2023 Affects CBO’s Projections of Federal Debt
Report
Deficit reductions under the Fiscal Responsibility Act of 2023 reduce projected federal debt in 2033 by about 3 percent, from $46.7 trillion (or 119 percent of gross domestic product, or GDP) to $45.2 trillion (or 115 percent of GDP).
On June 3, President Biden signed into law the Fiscal Responsibility Act of 2023 (FRA, Public Law 118-5), which suspends the limit on federal debt through January 1, 2025, and makes a number of changes that affect federal spending and revenues. The Congressional Budget Office provided an assessment of the budgetary effects of that act in a letter dated May 30.
This report builds on that earlier assessment by showing how those budgetary effects change projections of federal debt. Specifically, the $1.5 trillion reduction in projected deficits estimated to result from the FRA over the next 10 years reduces projected federal debt held by the public in 2033 by about 3 percent, from $46.7 trillion (or 119 percent of gross domestic product, or GDP) to $45.2 trillion (or 115 percent of GDP).
