The US national debt has surged to a staggering $33 trillion, as confirmed by the Treasury Department’s daily report. A quick glance at the real-time US debt clock website showcases an even more precise figure, $33.04 trillion, with the debt to GDP ratio settling uncomfortably at 122.4%.
Treasury Secretary Janet Yellen, while admitting that the interest on this vast sum remains within the realm of manageability, used her next breath to emphasize the urgency for concrete measures from policy makers. She alluded to President Joe Biden’s proposals to balance the nation’s books while nurturing economic growth but left listeners in suspense, providing no details.
The narrative of America’s national debt took a sharp twist recently. In June, Biden Biden gave the green light on a bill to make the $31.4 trillion debt ceiling go “poof” for two years, essentially handing the government a blank check, allowing it to borrow indefinitely till 2024. The backdrop to this drastic move was the looming threat of the country defaulting on its commitments, a situation the Treasury was keen to avert.
The repercussions were immediate; the national debt skyrocketed to $32 trillion in less than two weeks following the bill’s approval. For a sobering comparison, it was only four decades ago when the US was only a mere $907 billion in debt. Fast forward to today, and forecasts from the Congressional Budget Office paint a daunting picture— the national debt might nearly double over the next 30 years.
The journey to the $33 trillion debt landmark has set off alarm bells among fiscal experts. “The United States has hit a new milestone that no one will be proud of: our gross national debt just surpassed $33 trillion. Debt held by the public, meanwhile, recently surpassed $26 trillion. We are becoming numb to these huge numbers, but it doesn’t make them any less dangerous,” said Maya MacGuineas, the helm of the Committee for a Responsible Federal Budget (CRFB).
Echoing MacGuineas’ worries, Sean Snaith, a respected economist from the University of Central Florida, offered his two cents to FOX Business. Describing the current debt figure as a glaring red flag, he cautioned the US government against its unsustainable fiscal trajectory. He emphasized a simple, undeniable truth: continuously spending trillions more than what’s being raked in is a recipe for disaster.
Information for this briefing was found via the Treasury and Fox News. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.