The United States’ national debt is above $34 trillion, but leaders in Washington do not notice. Instead, they’re focused on more important things, like the national security threat of foreign garlic or maintaining funding for a United Nations aid organization, some of whose workers may have been involved with the Hamas attack on Israel on Oct. 7.
Sadly, it’s more and more difficult to take Congress seriously at a time when our domestic and international challenges are becoming more serious. Now, the United States finds itself grappling with a monumental issue that threatens the very foundation of our economic stability: a staggering national debt that is already above 122% of US gross domestic product (GDP). The ominous implications of this financial burden demand urgent attention, yet the deafening silence from both major political parties leaves the nation teetering on the precipice of a fiscal catastrophe.
The latest data from the US Treasury Department, revealing the record-breaking debt, should serve as a wake-up call to a nation already reeling from political divisions. The urgency of the matter must be addressed, as failure to address this growing crisis may result in parts of the government shutting down due to the lack of an annual budget. This scenario would further deepen the existing turmoil.
The trajectory of the national debt has surpassed projections set just a few years ago. While both the Trump and Biden administrations inherited unprecedented national debt, they each resorted to heavy borrowing to facilitate economic recovery, and the aftermath has been far from the anticipated success story.
The escalating national debt is closely tied to government overspending, as highlighted by the nonpartisan Congressional Budget Office. In 2023, the spending deficit represented 5.8% of GDP, highlighting a concerning trend. Although the spending deficit is supposed to decrease temporarily to 5.0% by 2027, it will begin an upward trajectory, soaring to a worrisome 10.0% of GDP by 2053. Such levels have been surpassed only during World War II and the COVID-19 pandemic.
The root cause lies in the persistent gap between spending and revenues, with the total deficit exacerbated by mounting interest costs. The primary deficit, excluding interest expenses, remains at 3.3% of GDP in both 2023 and 2053, underscoring the critical role that unchecked government spending plays in driving the alarming growth of the national debt over time.
Picture a family with a $100,000 annual income, and currently, their credit card debt has skyrocketed to $122,000. The family’s mounting debt is intricately linked to their habit of overspending. However, the family’s current trajectory means that, despite making some payments, their credit card debt is increasing by $5,800 annually. To afford this mounting financial burden, the family must divert an even more significant portion of their income toward interest payments on their loans, further straining their financial stability and limiting their capacity to invest in their family’s future — such as retirement or college savings. Just as this family must grapple with the urgent need to address their spending habits to ensure long-term economic well-being, our nation must do the same.
It is disheartening to note that, despite the severity of the situation, the temporary agreement reached in June 2023 by Republican lawmakers and the White House to lift the nation’s debt limit until January 2025 has not been followed by concrete actions addressing the root causes of the crisis. This short-term fix only postpones the inevitable, allowing the debt to continue its relentless ascent.
The Congressional Budget Office’s projection that publicly held debt could reach a record 181% of American economic activity by 2053 should set off alarm bells. The lack of a comprehensive, bipartisan strategy to tackle this issue is a testament to the negligence of both major political parties.
But further than the fiscal implications, the skyrocketing national debt poses a significant national security threat due to its economic implications and the alarming concentration of debt in the hands of foreign entities, particularly China. With China holding a substantial $868.9 billion of US debt, the risk of economic turmoil becomes palpable. If China suddenly decided to dump all its US debt holdings at once, the repercussions would be severe and far-reaching.
Such a move could trigger a rapid spike in American interest rates, causing borrowing costs to surge for the United States. This interest spike would likely lead to a domino effect across financial markets, resulting in a devaluation of the US dollar, which would impact international trade markets in several ways. A weaker dollar would make American exports more competitive while raising prices for imported goods, potentially improving the US trade balance but contributing to even more domestic inflation. Global supply chains and business strategies would shift in response to currency fluctuations, and the risk of currency wars could emerge as other nations adjust to the changed economic landscape. Additionally, changes in capital flows and potential central bank actions would further shape the dynamics of international trade markets, affecting investors and economies worldwide.
In an era of intense partisanship, it is disconcerting that the national debt crisis is not receiving the attention it deserves. Instead of engaging in meaningful discussions and formulating long-term solutions, politicians seem more inclined to ignore the problem and grapple with each other over the next 30-second soundbite on Fox or MSNBC.
Our national government needs serious people to take on the issues of governing — not endless hearings that achieve nothing, and not an endless list of programs that only we cannot afford.
Last year, I signed the Freedom Conservatism Statement of Principles because the national debt “is an existential threat to the future prosperity, liberty, and happiness of Americans.” Ignoring the national debt crisis is not an option; it is a collective responsibility that transcends party lines. The consequences of inaction are too severe to be ignored, and the time to address this critical issue is now, before the nation’s economic foundation crumbles beneath the weight of its debt.