In a milestone that could make even the most extravagant spender blush, the U.S. national debt has soared past the $32 trillion mark, a record-breaking feat according to recent data released by the Treasury Department. As of June 16, the debt reached an astronomical figure of $32.04 trillion, encompassing roughly $25 trillion in debt held by the public and an additional $7 trillion in intragovernmental debt. This mind-boggling number comes just days after President Joe Biden signed the Fiscal Responsibility Act into law, conveniently suspending the debt ceiling for a whopping 19 months and giving the government a green light to continue borrowing until the end of 2024.
To put this in perspective, the debt ceiling had already been raised to $31.4 trillion back in December 2021. Yet, like a frenzied shopper on a spending spree, federal borrowing surged by nearly $400 billion immediately after Biden’s bill signing. It’s as if the national debt were a restless beast, hungry for new heights.
Predictably, the Congressional Budget Office projects a federal deficit of $1.4 trillion for fiscal year 2023, further exacerbating an already precarious situation. While the legislation signed by Biden includes some $1.5 trillion in spending cuts over the next decade, the administration’s 2024 budget proposal paints a grim picture of the future. By 2033, the gross national debt is projected to exceed a jaw-dropping $50 trillion, an increase of over $17 trillion over the next decade alone. That’s like adding the entire national debt held by the public before the COVID-19 pandemic on top of the existing burden.
This dire situation has experts sounding the alarm on what they call our “debt addiction.” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, laments the trillion-dollar debt increments that have become routine, warning that $33 trillion is just around the corner. MacGuineas calls for a return to responsible fiscal policy, urging politicians to make the tough choices necessary to address the drivers of our runaway debt. It’s not rocket science, she asserts, but a straightforward formula: no new borrowing unless fully offset, tackle the root causes of the debt, and fix the broken budget process. It seems like common sense, yet implementation remains elusive.
Michael A. Peterson, CEO of the Peter G. Peterson Foundation, shares the concern, emphasizing the need to confront the fundamental drivers of our debt. Peterson points to the unyielding growth of mandatory spending and the insufficiency of revenues to sustain it. Ignoring the mounting debt, he warns, is a dangerous game that jeopardizes critical social programs and burdens future generations with an unimaginable financial burden. As we hurtle past $32 trillion with no end in sight, the urgency to address this predicament becomes increasingly apparent.
In the midst of this fiscal conundrum, political battles ensue. House Republicans propose a major tax cut plan aimed at boosting employment, supporting small businesses, and providing relief to households grappling with inflation. On the other side, Democratic lawmakers have introduced a bill that essentially allows Treasury to ignore the debt cap and continue issuing checks without limits, a move that sparks its fair share of controversy.
With the debt ceiling temporarily shelved and a seemingly insatiable appetite for borrowing, the nation finds itself at a crossroads. The consequences of inaction loom large, with social programs heading towards insolvency and the potential for adding a staggering $127 trillion to the debt over the next 30 years. As we hurtle toward a future where almost 40 percent of federal revenues will be consumed by interest payments alone, the burden placed on future generations is simply unthinkable.
The time for meaningful action is now. The debt ceiling dance can only distract us for so long. It’s imperative that we address the underlying issues driving our debt spiral, make tough choices, and steer ourselves away from this perilous path. Our financial future, and that of generations to come, depends on it.
