Economy·Sep 17, 2026
Moody's Economist Says AI Productivity Boom Could Ease U.S. Debt Burden
Mark Zandi says a scenario resembling the late-1990s productivity surge could push the primary deficit near zero within six or seven years, though AI's own costs could offset the gains.
Moody's Analytics chief economist Mark Zandi says artificial intelligence could offer an unexpectedly powerful way to manage the growing U.S. federal debt, according to TheStreet.
Gross federal debt stands at nearly $40.1 trillion, up from about $30.9 trillion at the end of fiscal 2022, meaning the government has added roughly $9 trillion in under four years, TheStreet reports. Zandi discussed the debt outlook on the "Inside Economics" podcast, which he leads for Moody's Analytics.
Under a scenario resembling the late-1990s productivity boom, Zandi's analysis found that stronger AI-driven economic growth could push the primary deficit close to zero within six or seven years, TheStreet reports. He cautioned, however, that AI could also create new fiscal costs that eat into much of that benefit.
Zandi noted the federal deficit is currently running near 6% of GDP, with the primary deficit around 3% and publicly held debt roughly equal to the size of the economy, according to TheStreet.
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