The publicly held debt/GDP ratio of the US is currently 66.7%, the highest in the post-World War II period. The Congressional Budget Office (CBO) projects that it will rise to 72.8% in 2013 before gradually declining to a more manageable 61% in 2021.
These baseline projections, however, assume that the legislation in place in August 2011 remains as is, including the expiration of the payroll tax holiday and emergency unemployment compensation at the end of 2011; reducing payments to Medicare physicians; expanding the alternative minimum tax base; and ending the 2001, 2003 and 2010 tax cuts at the end of 2012. In an alternative projection, where some or all of these provisions are extended, the CBO estimates that public debt/GDP will exceed 80% by 2021. These projections include the Budget Control Act of 2011, which provides for $2.1 trillion in budget cuts...
