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Amid the federal government shutdown, the U.S. government’s gross national debt surpassed $38 trillion on Wednesday, a record number that highlights the rapid accumulation of debt on America’s balance sheet.
This is the fastest accumulation of a trillion dollars of debt outside the COVID-19 pandemic – the US gross national debt reached $37 trillion in August this year.
$38 trillion update found in latest treasury department Report, which logs the daily finances of the country.
Kent Smeters of the University of Pennsylvania’s Penn Wharton Budget Model, who worked in President George W. Bush’s Treasury Department, told The Associated Press that a growing debt burden over time ultimately leads to higher inflation, which reduces Americans’ purchasing power.
The Government Accountability Office has outlined some of the effects of rising government debt on Americans – including higher borrowing costs for things like mortgages and cars, lower wages from businesses with less money available for investment, and more expensive goods and services.
“I think a lot of people want to know that their children and grandchildren will be in a good, decent situation in the future — that they will be able to buy a house,” Smeters said. “Excess inflation adds up” and erodes consumers’ purchasing power, making it less possible for future generations to achieve home ownership goals, he said.
trump The administration says its policies are helping to slow government spending and will reduce the country’s massive deficit. A new analysis from Treasury Department officials said the cumulative deficit from April to September totaled $468 billion. x In a post on Wednesday, the Treasury Secretary Scott Besant Said that this is the lowest reading since 2019.
“During his first eight months in office, President Trump has reduced the deficit by $350 billion by cutting spending and raising revenues, compared to the same period in 2024,” White House spokesperson Kush Desai said in a statement. He said the administration will deliver strong economic growth, low inflation, increased tariff revenues, lower borrowing costs and cuts in waste, fraud and abuse.
The Joint Economic Committee estimates that the total national debt grew at a rate of $69,713.82 per second last year.
michael peterson“Reaching $38 trillion in debt during the government shutdown is the latest troubling sign that lawmakers are not fulfilling their basic fiscal duties,” Peter G. Peterson, president and CEO of the Peterson Foundation, said in a statement.
“As the debt grows, you also get higher interest costs, which is now the fastest-growing part of the budget,” Peterson said. “We spent $4 trillion on interest over the last decade, but will spend $14 trillion over the next ten years. The cost of interest drains vital public and private investments in our future, hurting the economy of every American.”
America’s debt will reach $34 trillion in January 2024, $35 trillion in July 2024, and $36 trillion in November 2024.