"The nation's finances have deteriorated" since President Trump took office, driven by sweeping legislative and trade policy changes, according to the Committee for a Responsible Federal Budget (CRFB). The nonpartisan watchdog noted that the Congressional Budget Office's January 2025 budget outlook "already showed a worrisome fiscal outlook," but developments since mean a widening deficit. The CRFB gamed out several scenarios, including an adjusted baseline which accounts for "most legislative and administrative changes but not economic and technical changes." The CRFB also included an alternative scenario in which the U.S. Trade Court's ruling that many of Trump's tariffs are illegal is upheld; temporary provisions of the One Big Beautiful Bill Act are made permanent; and yields on Treasury securities remain at their current level.
The adjusted baseline shows cumulative deficits are forecast to reach $22.7 trillion, amounting to 6.1% of GDP, with annual deficits climbing from $1.7 trillion in 2025 to $2.6 trillion in 2035. Meanwhile, it sees debt held by the public rising from about 100% of GDP -- currently $30 trillion -- to 120% of GDP ($53 trillion).
Under the CRFB's alternative scenario -- where key OBBBA provisions are made permanent, tariff revenues fall owing to legal setbacks, and interest rates remain elevated -- debt could climb to 134% of GDP by 2035 and the 10-year deficit would exceed $28.5 trillion. Over fiscal years 2026 through 2035, net interest payments alone are set to total $14 trillion over the decade, nearly doubling from $1 trillion this year to $1.8 trillion by 2035.
Expenditures are expected to grow, totaling $88 trillion (23.6% of GDP) for the decade, while revenues -- spurred on by tariffs replacing some lost tax receipts -- will reach $65 trillion (17.5% of GDP). This persistent gap between spending and revenue underpins the widening deficit. The CRFB has previously weighed in on the tariffs' impact on deficits, calling them both "significant" and "meaningful."
Central to the deteriorating outlook is enactment of the One Big Beautiful Bill Act (OBBBA), which the CRFB projects will increase deficits by $4.6 trillion over the next decade and push debt up by more than 10% of GDP by 2035.
Meanwhile, a surge in tariffs following administration policies is expected to offset some costs, saving $3.4 trillion in deficits and reducing debt by 8% of GDP over the same period. These savings are, however, at risk: The U.S. Court of International Trade ruled much of the tariff regime illegal in May, and if that decision stands, tariffs could produce less than $1 trillion in deficit reduction -- adding $2.4 trillion to the federal deficit and increasing debt by 5.7% of GDP.