National Debt Reaches Historic High as Potential Shutdown Looms
CV NEWS FEED // According to official Treasury Department data, the United States gross national debt reached $33 trillion this week and continues to climb.
Maya MacGuineas, who heads the Committee for a Responsible Federal Budget (CRFB), called the historically high figure a “new milestone that no one will be proud of.”
“Debt held by the public, meanwhile, recently surpassed $26 trillion,” she said. “We are becoming numb to these huge numbers, but it doesn’t make them any less dangerous.”
The CRFB is a nonpartisan think tank whose stated mission is “educating the public on issues with significant fiscal policy impact.” It was jointly founded in 1981 by a Democratic congressman and a Republican senator.
“The Congressional Budget Office [CBO] confirmed just last week that the underlying deficit is going to roughly double from last fiscal year to this one,” MacGuineas said. “Instead of hearing about solutions, we hear promises of which programs our leaders are unwilling to touch and which taxes they are unwilling to raise.”
“That kind of talk is not only pandering, but it’s also downright irresponsible when we have a mess like this on our hands,” the CRFB president added.
As The Daily Wire reported, the CBO “warned in June that high interest rates and rising national debt could make net interest payments spike to 6.7% of GDP by 2053, according to Fortune.”
Before the FRA, which is colloquially known as the “debt ceiling deal,” the “ceiling” was $31.4 trillion. In a February explainer article, CatholicVote’s Erika Ahern defined the debt ceiling as “the legal limit on the amount of money Congress can borrow to pay for its programs.”
>> EXPLAINER: THE DEBT CEILING AND CATHOLIC SOCIAL TEACHING <<
According to the CBO, the deal “suspends the limit on federal debt through January 1, 2025, and makes a number of changes that affect federal spending and revenues.”
MacGuineas explained that “getting the debt under control will require taking a serious look at health care, Social Security, and the tax code.” But if
policymakers find it too difficult to do this under regular order, then they should put in place a bipartisan fiscal commission to propose solutions.
Policymakers need to be straight with the American public, and they need to come together on a plan to bring our debt under control.
The Daily Wire noted that the $33 trillion milestone “comes as House Republicans proposed a short-term plan on Sunday that would temporarily fund the government through October 31 to avoid a shutdown and impose an 8% spending cut on federal agencies, excluding defense funding, veterans affairs, and disaster relief.”
The measure faces long odds of passing, given that it “received opposition from fellow GOP lawmakers while Democrats are unlikely to support it,” The Daily Wire reported.
Michael A. Peterson, who runs a budget watchdog group, observed that “the cost of debt can mount suddenly and rapidly.”
“With more than $10 trillion of interest costs over the next decade, this compounding fiscal cycle will only continue to do damage to our kids and grandkids,” he added.
Hedge fund investor Mark Spitznagel agreed that present times are unique. “We’ve never seen anything like this level of total debt and leverage in the system,” he stated. “It’s an experiment. But we know that credit bubbles have to pop. We don’t know when, but we know they have to.”
