US National Debt Surpasses $37 Trillion, Fueling Economic Concerns
US National Debt Surpasses $37 Trillion, Fueling Economic Concerns
The U.S. government’s gross national debt has officially surpassed a staggering $37 trillion, according to the latest report from the Treasury Department. This record-breaking figure underscores the rapid acceleration of America’s national debt and signals increased cost pressures on taxpayers.
This milestone was reached years ahead of pre-pandemic projections. The Congressional Budget Office (CBO) had initially predicted the national debt would not eclipse $37 trillion until after fiscal year 2030. However, the debt has grown at an unprecedented pace, primarily due to heavy federal borrowing during the multi-year COVID-19 pandemic under both the Trump and Biden administrations, aimed at stabilizing and recovering the national economy.
Further contributing to the escalating debt is recent government spending, including the tax cut and spending legislation signed into law by former President Trump earlier this year. The CBO estimates this legislation alone will add an additional $4.1 trillion to the national debt over the next decade.
Experts are vocal about the implications. Michael Peterson, Chair and CEO of the Peter G. Peterson Foundation, warned that government borrowing drives up interest rates, increasing costs for consumers and businesses alike while diminishing private sector investment. He highlighted a damaging cycle within the federal budget where debt crowds out critical priorities, leading to more borrowing and higher interest costs.
Wendy Edelberg, a senior fellow in Economic Studies at the Brookings Institution, emphasized Congress’s pivotal role in fiscal policy, noting that current tax laws will necessitate significant borrowing through 2026 and 2027, with no end in sight. The Government Accountability Office (GAO) has outlined the direct impacts on Americans, including higher borrowing costs for mortgages and cars, reduced wages due to decreased business investment, and more expensive goods and services.
The pace of debt accumulation is alarming. Peterson pointed out that trillion-dollar milestones are now occurring every five months, more than twice the average rate over the last 25 years. The U.S. debt hit $34 trillion in January 2024, $35 trillion in July 2024, and $36 trillion in November 2024. The Joint Economic Committee estimates that, at the current daily growth rate, another trillion dollars will be added in approximately 173 days.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, expressed hope that this latest milestone will serve as a wake-up call for policymakers to take urgent action on the nation’s fiscal health.
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