Bleak Budget Outlook as Deficit Projected to Surge

Congressional Budget Office report shows rising debt, interest payments, and unsustainable spending trends

Published on Feb. 16, 2026

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The Congressional Budget Office has released its latest 10-year budget estimates, painting a bleak picture of the nation's fiscal future. The deficit is projected to rise steadily over the next decade, reaching $3.115 trillion by fiscal 2036, nearly a quarter of GDP. Despite expected record revenue growth, spending is set to outpace it, driven by higher costs for entitlements and interest payments on the growing debt.

Why it matters

The CBO's projections highlight the urgent need for fiscal leadership and responsible policy decisions to address the worsening debt crisis. Failure to act could jeopardize progressive spending priorities and leave future generations saddled with unsustainable debt.

The details

The CBO report shows the deficit for fiscal 2025 at $1.775 trillion, rising to $3.115 trillion by 2036. Tax collections are expected to increase from $5.6 trillion this year to $8.3 trillion by 2036, but spending will grow even faster, from $7 trillion to $11.4 trillion. Higher costs for entitlements and interest payments on the debt will consume a growing share of federal spending, with net interest outlays projected to rise from 3.3% of GDP in 2026 to 4.6% in 2036.

  • The CBO released its latest 10-year budget estimates this week.
  • The deficit for fiscal 2025 is projected at $1.775 trillion.
  • By fiscal 2036, the deficit is expected to reach $3.115 trillion.

The players

Congressional Budget Office

The nonpartisan federal agency that provides budget and economic analysis to Congress.

Maya MacGuineas

President of the Committee for a Responsible Federal Budget, a nonpartisan organization focused on addressing the nation's fiscal challenges.

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What they’re saying

“There are no surprises here or bright spots of encouraging news: Our nation's deficits, debt, interest payments and trust funds are all in terrible shape.”

— Maya MacGuineas, President, Committee for a Responsible Federal Budget (News release)

What’s next

Voters who prefer fiscal responsibility to national bankruptcy should support candidates committed to addressing the nation's worsening debt crisis through tough policy choices and responsible fiscal management.

The takeaway

The CBO's bleak budget projections underscore the urgent need for Congress to take meaningful action to rein in the growing deficit and debt. Failure to do so could jeopardize important spending priorities and leave future generations saddled with unsustainable financial burdens.