The Government Accountability Office has issued a report warning Congress and the administration anew that the country is on an unsustainable fiscal path that, if not corrected, would pose serious economic, security and social challenges.
Table of Contents
Debt Projections
GAO said that as of Dec. 31, 2024, federal debt was at $28.7 trillion and that at its current rate of growth, it will reach 106 percent of gross domestic product by 2027, one year sooner than previously projected. That percentage is the highest in U.S. history, last seen in 1946.
The government watchdog further warned that over the next three decades, federal debt is projected to grow more than twice as fast as the economy, and that at that rate, federal debt is expected to reach 200 percent of GDP by 2047, three years sooner than previously forecasted.
Drivers of Debt
According to GAO’s analysis, the growing federal debt is being driven by annual budget deficits, which has two components. The first is the deficit between government revenue and program spending as prescribed by policy. This deficit is expected to grow in part due to slower revenue growth relative to spending growth in Medicare, other federal healthcare and Social Security programs.
The second component is the interest from the money that has to be borrowed to pay for the first component. GAO said that since 2017, annual spending on net interest has more than tripled and is expected to continue growing.
Between the two, the government has more control over the primary component because it is based on policy decisions.
Structural Imbalance
For GAO, the time to put in place a sound fiscal strategy to address what the office described as the “structural imbalance between spending and revenue” is now. The office called on Congress to put into effect “a strategy to inform the difficult policy choices that are needed to put the government on a more sustainable fiscal path.”
Related Articles
Gregory Barbaccia, federal chief information officer and a 2025 Wash100 awardee, has shared his insights on how the federal government should advance digital transformation. “I notice a lot of the government considers itself to be ‘digital,’ but in reality, we’ve only digitized, not transformed. Sure we went 0-1, but that should have just been the beginning,” Barbaccia wrote in a LinkedIn post. He noted the lack of automation and that workflows remain unchanged despite the replacement of paper ledgers with spreadsheets. “Files are shared over email instead of through real-time collaboration tools,” he added. Advancing Digital Transformation in Federal Government
The Federal Communications Commission has adopted new rules that seek to eliminate unnecessary paperwork and address regulatory barriers to the ground-station-as-a-service, or GSaaS, business model as part of efforts to drive innovation in the U.S. space economy. FCC said Thursday the new rules establish a process for ground station operators to secure a baseline license without first identifying a satellite point of communication. A simple FCC notification will be required for each new point of communication. According to FCC, the change would eliminate nearly half of earth station modification applications. “Making the smallest change to a satellite system or earth
The General Services Administration has announced a OneGov agreement with Amazon Web Services that will provide up to $1 billion in direct incentive credits to federal civilian agencies. According to GSA, the direct incentive credits, aggregated across the agencies, will include savings on core AWS cloud services through AWS credits, infrastructure and application technologies modernization through AWS modernization credits, access to AWS training and certification through training credits and a streamlined engagement model with greater savings for direct contracts through direct partnerships. Advancing America’s AI Leadership The agreement is expected to accelerate large-scale IT transformation and boost AI innovation across