Congrats, Joe Biden. You’ve successfully broken the record…of the highest US national debt in history. Bad news for Americans, but perhaps Biden is celebrating? On Monday, September 18, the United States’ gross national debt exceeded $33 TRILLION – passing the highest number on record.
This comes weeks before Congress’ September 30 deadline to fund the government. The debt held by the public, which is owed by Washington to those outside of it, also hit an all-time high at $27 trillion.
It’s no surprise that this has become a major crisis in our country since the pandemic and war in Ukraine have caused it to skyrocket over recent years; between 2019 and 2020 alone it grew by $5 trillion – with another $6 trillion added since then.
Treasury Secretary Janet Yellen spoke out about what this could mean for us during an interview with CNBC, saying she isn’t too worried so long as leaders keep things on track. However if they don’t, serious problems could arise.
Mark Spitznagel of Universa Investments had even stronger words: “We’ve never seen anything like this level of total debt and leverage in the system.”
He warned that “it’s an experiment” and although we don’t know when or how it will end, he believes credit bubbles must eventually pop.
The Congressional Budget Office released their annual report in June predicting that federal debt held by the public will reach 98 percent of GDP by 2023 – surpassing its historical peak of 107 percent in 2029 and growing to 181 percent of GDP by 2053.
If these predictions are correct, economic growth would be significantly slowed due to such high levels of debt while interest payments would increase for foreign holders attempting to collect from us; additionally lawmakers may face limited policy choices as a result.
The US has been dealing with national debt since its founding but began reaching trillions more recently – hitting its first trillion mark back in 1981 and continuing until today at 33 trillion dollars.
It’s clear that steps need to be taken soon if we want to avoid further disaster down the line; only time will tell what will happen next as we move closer towards addressing this issue head-on.
