US National Debt Hits All-Time High Of $32 Trillion
The US national debt has reached a staggering $32.04 trillion, as revealed by the Treasury Department’s daily statement on June 16. This marks the first time in US history that the national debt has exceeded $32 trillion. The debt includes about $25 trillion in debt held by the public and $7 trillion in intragovernmental debt. The June 3 legislation signed by President Joe Biden, called the Fiscal Responsibility Act, suspended the debt ceiling for 19 months, allowing the government to continue borrowing money until the end of 2024.
The federal deficit for fiscal year 2023 is projected to be $1.4 trillion, according to the Congressional Budget Office. Though the Fiscal Responsibility Act has included $1.5 trillion in spending cuts over the next decade, the gross national debt under the Biden administration’s 2024 budget proposal is predicted to exceed $50 trillion by 2033. This projection indicates an increase of more than $17 trillion over the next decade, which is higher than the entire national debt held by the public before the COVID-19 pandemic.
The $32 trillion mark was reached nine years sooner than what had been projected before the COVID-19 pandemic, primarily due to trillions of dollars of congressionally-approved COVID-19-related spending. Maya MacGuineas, president of the Committee for a Responsible Federal Budget, called this situation a “debt addiction” that places a debt burden on future generations, while Michael A. Peterson, CEO of the Peter G. Peterson Foundation, called for addressing the fundamental drivers of the debt.
House Republicans recently proposed a tax cut plan to create jobs, support small businesses, and provide relief to inflation-squeezed households. Meanwhile, Democrat lawmakers have introduced a bill that would let Treasury ignore the debt cap and continue writing cheques without limit. The Debt Ceiling Reform Act would authorize the Treasury Department to keep paying the government’s bills irrespective of the statutory debt limit, unless Congress expressly opposes it.
As the US national debt continues to rise, it is essential for lawmakers to address the drivers of the debt and promote responsible fiscal policies to prevent a potential crisis.
