TRIVIA

The fight against the COVID-19 pandemic has required one of the largest fiscal efforts in history. In the case of the United States, the government has had to issue massive amounts of debt to finance this effort, a burden to which other needs will be added in the coming decades.

What percentage of GDP will U.S. federal debt held by the markets account for by 2050? 

a) 74%

b) 98%

c) 195% 

d) 252%

Answer:

c) 195% 

195% is the projection from the Congressional Budget Office—by far the highest proportion of federal debt held by the market in the country’s history, as we can see in this chart from Visualcapitalist. Federal debt held by the market exceeded 100% in 1946, when President Truman had to combat the postwar depression, but it subsequently declined. Between 2019 and 2020, this debt-to-GDP ratio rose from 79% to 98% due to the pandemic and is expected to reach 104% this year. The sharp increase expected starting in 2030 is due to projected rising expenditures on Social Security and health coverage (Medicare).

https://www.visualcapitalist.com/timeline-150-years-of-u-s-national-debt/