Congressional Budget Office (CBO) Predicts COVID-19 to Cut U.S. GDP by $15.7 Trillion by 2030
In a letter responding to an inquiry made by Democratic Leader Senator Chuck Schumer (D-NY), the Congressional Budget Office (CBO) explains how its May 2020 interim projections of gross domestic product (GDP) compares with projections made earlier in the year. Looking first at the second quarter of this current calendar year, CBO projects that GDP will be 14.2% lower than predictions made in January, due to the economic impact of COVID-19. Furthermore, CBO predicts that over the next ten years, the Untied States see $15.7 trillion less in GDP than what the agency projected in January due to the ongoing pandemic. This accounts for a 5.3% reduction in GDP over the next ten years compared with previous projections.
The letter goes on to address the uncertainty and fluidity of the moment, suggesting that actual economic outcomes could differ drastically depending on how and if the virus is contained in the coming year, and depending on what policies lawmakers enact. As the year progresses, the CBO intends to publish a more comprehensive economic outlook, hoping for more certainty in understanding the trajectory of the coronavirus pandemic and its economic impacts.
To read the full letter, please visit: https://www.cbo.gov/system/files/2020-06/56376-GDP.pdf.