DistantNews
Support us
🇺🇸 United States /Economy & Trade

US national debt tops $40 trillion, doubling in under 10 years

From CBS News · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Official statement Context piece
  • The U.S. national debt surpassed $40 trillion, doubling in less than 10 years, according to Treasury Department data.
  • Mounting borrowing and interest costs are driven by government spending outpacing revenue, with interest payments now consuming more than national defense or Medicare.
  • Analysts warn the debt is accelerating due to ignored structural budget challenges and is unlikely to slow without reforms, potentially reaching $50 trillion in six years.

The U.S. national debt has crossed the $40 trillion mark, a fiscal milestone highlighting the government's escalating borrowing and interest expenses. Treasury Department data released Wednesday shows the debt reached $40.05 trillion on August 18, more than double its 2017 level.

We've been running deficits for the last 26 years, and we've basically ignored a lot of the structural challenges that exist in our budget that are very well known. It's clearly been accelerating because, like any debt problem, the longer you ignore it, the worse it gets.

— Michael PetersonCEO of the nonpartisan Peter G. Peterson Foundation, explaining the accelerating debt problem.

This ballooning debt stems from government spending consistently exceeding revenue, necessitating increased borrowing. Michael Peterson, CEO of the Peter G. Peterson Foundation, noted that "structural challenges" in the budget have been ignored for 26 years, leading to an accelerating problem. He warned that "the longer you ignore it, the worse it gets."

As the government borrows more, interest payments on the debt are consuming a larger portion of federal spending, creating a compounding effect. The U.S. now spends more on servicing its debt than on national defense or Medicare. Analysts like Dean Baker, co-founder of the Center for Economic and Policy Research, suggest the debt growth will continue, citing increased military spending as a factor. The Peterson Foundation estimates the debt could reach $50 trillion in six years without significant spending or tax reforms.

We're going the wrong way.

— Dean BakerCo-founder of the economic think tank Center for Economic and Policy Research, commenting on the nation's debt growth.

While policy decisions, including tax cuts and increased spending on programs like Social Security and Medicare due to an aging population, have contributed, the debt problem is not tied to a single administration. "Many administrations and many Congresses have taken steps in the wrong direction," Peterson stated. Major economic crises, such as the 2008 Great Recession and the COVID-19 pandemic, have also triggered spikes in national debt. Experts caution that this rising debt could impede the country's capacity to manage future economic shocks.

Many administrations and many Congresses have taken steps in the wrong direction.

— Michael PetersonOn the historical contributions to the national debt across different administrations.
DistantNews Editorial

Originally published by CBS News in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog