Ballooning US debt a ticking time bomb for world economy
The United States federal government‘s total public debt has exceeded $35 trillion for the first time, reigniting worries about the nation’s growing debt burden and its potential impact on the economy.
According to the latest Daily Treasury Statement released by the Treasury Department on Monday, the total public debt outstanding reached $35 trillion as of Friday. The data, updated daily with figures from the previous business day, underscores the ongoing increase in the nation’s debt levels, reported Xinhua news agency.
This milestone comes just seven months after the US national debt surpassed $34 trillion in late December 2023.
Prior to that, in a span of three months, the country had crossed the $33 trillion mark, marking a series of rapid increases in the federal debt.
“The borrowing just keeps marching along, reckless and unyielding,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, in a statement. “Yet despite all the risks and warning signs, these alarm bells seem to be falling on deaf ears.”
“We are going to have to get serious about the debt, and soon. Election years cannot be an exception for trying to prevent completely foreseeable dangers — and the debt is one of the major dangers we are facing,” said MacGuineas.
According to the Peter G Peterson Foundation, a nonpartisan organization focused on addressing US long-term fiscal challenges, the national debt of $35.001 trillion translates to nearly $104,000 of debt per person in the United States.
“Our deficits are caused mainly by predictable structural factors: our ageing baby-boom generation, rising healthcare costs, and a tax system that does not bring in enough money to pay for what the government has promised its citizens,” the foundation said.
Desmond Lachman, a senior fellow at the American Enterprise Institute and a former official at the International Monetary Fund, told Xinhua earlier that “there can be no question that the US budget deficit is on an unsustainable path.”
The “dangerous trajectory” poses “serious questions for the dollar” and inflation’s long-run outlook, Lachman said.
Analysts have joined the chorus of voicing serious concerns about the US debt problem. Economist E J Antoni, a research fellow of the Heritage Foundation, reports that based on the Fed’s June numbers, interest on the national debt is the equivalent of 76 percent of all personal income taxes collected by the government.
“America is going bankrupt btw,” American billionaire Elon Musk wrote in a recent post on the social media platform X.
BlackRock CEO Larry Fink told media: “This is my message not just to the US but to every country right now, we have rising deficits, no one is spending enough time talking about deficits, the US deficits are the largest in the world — growing at the fastest rate in the world — and we need to be finding ways to minimize the role of the deficit on the economy, on interest rates, on inflation.”
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