The volume of US government debt exceeded $34 trillion, which is a record. According to the Treasury Department, as of January 2, 2024, its size reached $34.001 trillion.
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What the American media write
The national debt reached this level several years earlier than predicted before the pandemic, American media write.
The COVID-19 pandemic, which began in 2020, caused a slowdown in the country's economic development. The government borrowed heavily under then-President Donald Trump and now-President Joe Biden to stabilize the economy and support its recovery. However, this led to a surge in inflation, causing interest rates to rise and making debt servicing more costly, the AP noted.
“Until now, Washington has spent money as if it had unlimited resources,” he said. Sung Won Sohn is a professor of economics at Loyola Marymount University. “But the point is, there’s no such thing as a free lunch, and I think the outlook is pretty bleak.”
Significant national debt does not seem to be putting pressure on the American economy yet, but its continued growth in the coming decades could jeopardize national security and such significant spending items as Social Security and Medicare, writes ABC News.
Debt in the US is about $100,000 per person.
At the same time, Another clash in Congress over the debt limit could become a financial risk if investors are not confident in the US willingness to repay the debt.
Large foreign buyers of US government bonds, such as China, Japan, South Korea and European countries, have already have reduced their investments in them.
According to the Peterson Foundation, foreign investments in US government bonds peaked at 49% in 2011, and by the end of 2022 fell to 30%.
“ Looking ahead, debt will continue to soar as the Treasury plans to borrow nearly $1 trillion more by the end of March, said Michael Peterson, the fund's chief executive officer. “An increase in debt, trillion after trillion, year after year, should be a stop sign for any politician who cares about the future of our country.”