New York Fed President Bill Dudley painted an unflattering picture for future growth, saying in a speech Thursday that the recently passed tax cuts pose an ominous threat down the road.

While he said the reforms that slash corporate taxes and lower rates for many earners will boost the economy in the near term, that "will come at a cost."

"After all, there is no such thing as a free lunch," Dudley said during a speech in New York, according to prepared remarks. "The legislation will increase the nation's longer-term fiscal burden, which is already facing other pressures, such as higher debt service costs and entitlement spending as the baby-boom generation retires."

The comments echo recent remarks from Fed Chair Janet Yellen, who said in November that escalating public debt and deficits "should keep people awake at night."

Both Yellen and Dudley will be leaving the central bank this year — Yellen in February when her term expires and the retiring Dudley likely in mid-year when when the New York Fed finds his replacement.

Their warnings come with the national debt at $20.5 trillion and a budget deficit for the current fiscal year projected at $693 billion. Critics of the tax plan say its estimated $1.5 trillion cost will cause the deficit to skyrocket, though the Trump administration and congressional Republicans insist that economic growth will offset the costs.

Dudley estimates that growth in 2018 will continue to be above trend amid strong consumer spending, rising incomes and sustainable personal debt growth.

However, he warned that while the escalating fiscal issues do "not seem to be a great concern to market participants today, the current fiscal path is unsustainable."

"In the long run, ignoring the budget math risks driving up longer-term interest rates, crowding out private sector investment and diminishing the country's creditworthiness," Dudley said. "These dynamics could counteract any favorable direct effects the tax package might have on capital spending and potential output."

Despite his longer-term pessimism, Dudley raised his outlook for 2018 GDP growth from 2.5 percent to 2.75 percent. He also expressed confidence that inflation will continue to tick up until it meets the Fed's 2 percent goal for healthy growth.

For the long term, he warned not only of the costs the tax cuts will impose on the deficit but also damage down to high-end housing by elimination of state and local property tax deductions.

Otherwise, he is "slightly — but not particularly" concerned about the zooming stock market prices but is more concerned about the economy overheating.