The Congressional Budget Office released its assessment of President Joe Biden and House Speaker Kevin McCarthy’s (R-CA) debt ceiling deal.
The assessment projected that the budget deficit would be reduced by roughly $1.5 trillion from 2023-2033, and reductions in discretionary outlays would amount to $1.3 trillion from 2024-2033.
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“The agency’s projections of budget deficits would be reduced by about $1.5 trillion over the 2023–2033 period relative to its May 2023 baseline projections,” the report said.
“Reductions in projected discretionary outlays would amount to $1.3 trillion over the 2024–2033 period. … Mandatory spending would, on net, decrease by $10 billion, and revenues would, on net, decrease by $2 billion over the 2023–2033 period. … As a consequence, interest on the public debt would decline by $188 billion,” it added.
The estimates are likely to bolster McCarthy, who has argued that the deal would lead to historic spending cuts.
“No other debt-limit increase in the past decade has reduced overall spending, reduced nondefense spending and reduced the deficit. The Fiscal Responsibility Act is true, transformative spending reform,” McCarthy wrote in a Wall Street Journal op-ed, referring to the legislative name for the deal.
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The main feature of the debt ceiling deal for those looking to cut spending is that the bill cuts nondefense discretionary spending next year and only allows a 1% increase for the next six years.
The bill still faces obstacles in the House and Senate, where many have expressed a willingness to vote against it, and the possibility of default still looms.
