The United States’ national debt surpassed a record $40 trillion, as defense costs and interest rates on the growing deficit continue to add up, representing a significant federal expense to service.
The figure reached $38 trillion in October and $39 trillion in March and as it grows, it adds pressure to already strained Americans, impacting borrowing costs, further driving up costs, and reducing the potential for economic investment and growth from businesses.
“The federal debt is already raising the cost of living and choking out other spending and investment, threatening our economy and Americans’ long-term prosperity,” said Margaret Spellings, president and CEO of the Bipartisan Policy Center, in a statement. “Our current fiscal trajectory is plainly unsustainable, and that’s the best-case scenario. AI disruption, a recession, global war, or any number of other events could quickly push us over the edge from a challenge into a full-blown crisis.”
While the U.S. is subject to a statutory debt limit to federal borrowing, the amount can be set, adjusted, or abolished by Congress. According to the Organization for Economic Co-operation and Development (OECD), the U.S. fiscal performance is amongst the worst of most developed countries.
