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President Biden. Photo: Saul Loeb/AFP via Getty Images

The federal government's total debt is expected to exceed the size of the U.S. economy this year, the Congressional Budget Office (CBO) said Thursday.

Why it matters: The projection doesn't include President Biden's proposed $1.9 trillion economic stimulus package and could reignite pushback from Republicans who'd prefer a smaller bill.

By the numbers: The CBO projects the federal budget deficit will hit $2.3 trillion in 2021, and the country's debt will reach 102% of the GDP, a slight increase from last year.

  • Yes, but: This year's annual federal deficit — the gap between government spending and collected tax revenue — is expected to be nearly $900 billion less than 2020's, according to the nonpartisan agency.

What they're saying: "At 10.3 percent of gross domestic product (GDP), the [federal budget] deficit in 2021 would be the second largest since 1945, exceeded only by the 14.9 percent shortfall recorded last year," the CBO said in its report.

  • "Those deficits, which were already projected to be large by historical standards before the onset of the 2020–2021 coronavirus pandemic, have widened significantly as a result of the economic disruption caused by the pandemic and the enactment of legislation in response."

What to watch: Without additional spending or tax cuts, the federal debt is expected to increase to 107% of GDP by 2031 — an all-time high in American history, per the CBO.

Go deeper: The stimulus debate: Is it too big?

Go deeper

Mike Allen, author of AM
25 mins ago - Politics & Policy

Biden adviser Cedric Richmond sees first-term progress on reparations

Illustration: "Axios on HBO"

White House senior adviser Cedric Richmond told "Axios on HBO" that it's "doable" for President Biden to make first-term progress on breaking down barriers for people of color, while Congress studies reparations for slavery.

Why it matters: Biden said on the campaign trail that he supports creation of a commission to study and develop proposals for reparations — direct payments for African-Americans.

Cyber CEO: Next war will hit regular Americans online

Any future real-world conflict between the United States and an adversary like China or Russia will have direct impacts on regular Americans because of the risk of cyber attack, Kevin Mandia, CEO of cybersecurity company FireEye, tells "Axios on HBO."

What they're saying: "The next conflict where the gloves come off in cyber, the American citizen will be dragged into it, whether they want to be or not. Period."

Cedric Richmond: We won't wait on GOP for "insufficient" stimulus

Top Biden adviser Cedric Richmond told "Axios on HBO" the White House believes it has bipartisan support for a stimulus bill outside the Beltway.

  • "If our choice is to wait and go bipartisan with an insufficient package, we are not going to do that."

The big picture: The bill will likely undergo an overhaul in the Senate after House Democrats narrowly passed a stimulus bill this weekend, reports Axios' Kadia Goba.

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