America's national debt has surpassed a record $40 trillion. Defense spending, welfare programs like Social Security and Medicare, and interest on the growing deficit make up a huge portion of federal spending
The $40 trillion figure comes just five months after the US reached a record $39 trillion in debt in March. Before that, they again broke the record of $38 billion five months earlier, in October.
The unprecedented $40 trillion figure shows the administration's priorities -- from increasing military spending to nearly six months of President Donald Trump's war in Iran, to decrease fuel price and food.
Kush Desai, a White House spokesman, said the Trump administration is "focused on reducing waste, fraud and abuse in federal spending while accelerating economic growth to get America's debt-to-GDP ratio moving in the right direction."
But experts say the exploding debt and the latest record borrowing are already taking a toll on Americans' pocketbooks: Borrowing costs are rising, wages are falling at businesses that have less money available to invest, and goods and services are becoming more expensive.
"If we want to improve our standard of living, today and for the next generation, now is the time for lawmakers to set our nation on a more affordable and sustainable path," said Michael A. Peterson, executive director of the Peter G. Peterson Foundation, a think tank focused on U.S. fiscal challenges.
The debt has exploded during several presidential administrations, as the country's leaders spend more money than is collected in taxes. More recently, the multi-year COVID-19 pandemic has shut down much of the U.S. economy, and the federal government borrowed heavily during President Trump's first term and under former President Joe Biden to stabilize the economy and support the country's economic recovery.
More government spending was authorized after Trump signed the Republican Tax Cuts and Spending Act last year.
Balanced budget advocates also warn that the long-term trend of higher borrowing and higher interest payments will force Americans to face tougher fiscal trade-offs in the future.
"The federal debt is already raising the cost of living and stifling other spending and investment, threatening our economy and the long-term prosperity of Americans," said Margaret Spellings, president and CEO of the Bipartisan Policy Center. "Our current fiscal trajectory is clearly unsustainable. Some disruption caused by AI, recession, global war, or any other event could quickly push us over the edge, from challenge to outright crisis."
Source: AP
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A black picture and the breakdown of the rule of law subscribeThe archive of the weekly Vreme includes all our digital editions, since the very beginning of our work. All issues can be downloaded in PDF format, by purchasing the digital edition, or you can read all available texts from the selected issue.
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