According to the CBO, Washington's spending exceeds revenues and may reach $804 billion in fiscal 2018. Over that period, the agency estimates revenue will be about 2 percent less than projected previous year, and spending about 1 percent higher. Debt held by the public, which has doubled in the past 10 years as a percentage of gross domestic product (GDP), approaches 100 percent of GDP by 2028 in CBO's projections.

This fiscal calendar year, which ends September 30, the budget deficit is expected to complete $804 billion, up from £ 665 billion last fiscal calendar year, according to the C.B.O. projections.

America's deficit is rising sharply and will surpass $1 trillion per year by 2020, a gap that has grown since Congress cut taxes and increased spending, the Congressional Budget Office reported Monday.

The agency said real GDP and real potential GDP, a measure of economic capacity, "are now projected to be greater throughout the coming decade than projected last June, in part because of the significant recent changes in fiscal policy".

The new projections by the Congressional Budget Office, the first federal budget analysis to be released since the Trump tax cuts were passed into law, shows how fully the Republican government has operationalized its theory.

According to top USA budget watchdog the Congressional Budget Office, America's budget deficit would be $US804 billion for the current financial year, which ends on September 30.

That would be a boost for President Trump, who has committed to generating growth of at least 3 percent.

"The CBO's latest report exposes the scam behind the rosy rhetoric from Republicans that their tax bill would pay for itself", said top Senate Democrat Chuck Schumer of NY. Expirations for individual tax rates at the end of 2025 will slow economic growth as well. But in a sign that Republicans are growing concerned about the political liability of soaring deficits, the House will vote Thursday on a constitutional amendment to require balanced budgets.

If Congress continues to let deficits balloon, it faces several long-term risks. "Those effects, as well as a larger federal budget deficit resulting from the new outliers, exert upward pressure on interest rates and prices".

Those cuts made when "the economy was already at or close to full employment ... turned economic logic on its head [and] this year's bipartisan spending agreement contributed further to the ill-timed stimulus", the authors write.