The following is a statement from Maya MacGuineas, president of the Committee for a Responsible Federal Budget:
As if lawmakers needed any other reasons to take America’s fiscal health seriously, the gross national debt of the United States has now officially reached $36 trillion. We started 2024 by crossing the $34 trillion threshold, added another trillion during the summer, and now we’re heading into the holidays with yet another trillion. Government borrowing is becoming as certain as the changing of the seasons these days.
It’s often said that the more times you say a word over and over, the more it starts to lose its meaning. With so many trillion-dollar debt milestones in recent years, it’s easy to forget that each of them has real-world consequences.
But rising debt poses serious domestic and geopolitical risks: it slows our economy, threatens higher inflation and interest rates, and squeezes our budget through higher interest rates. And it hampers our ability to be flexible in responding to recessions and disasters at home and foreign crises abroad.
And the future trajectory looks bleak as well. Even when using the more economically meaningful measure of debt held by the public – currently well over $28 trillion – debt is headed for an all-time record share of the economy in just two years. Interest payments are the fastest-growing part of the budget and will cost $13 trillion over the next decade alone.
The incoming Trump Administration and Members of the 119th Congress face several fiscal hurdles from the moment they take office – starting with the reinstatement of the debt ceiling in January and a $1.7 trillion PAYGO scorecard waiting to greet them. The way they approach that and other crucial decisions ahead like the expiration of discretionary spending caps and the 2017 tax cuts, as well as how they choose to offset the costs of their new policies, will determine our fiscal health for a long time. We hope they choose the responsible path forward.
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