Verba Volant, Scripta Manent

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Verba Volant, Scripta Manent

The Hill News

Verba Volant, Scripta Manent

The Hill News

What does the national debt reaching $34 trillion signify for the US?

Media: Grace Wang ’25

The U.S. national debt recently surpassed its milestone of $34 trillion just weeks after Congress decided on new funding plans. 

This number was reached a mere month after the debt hit $33 trillion, meaning that the U.S. accumulated $1 trillion in debt over three months. This rate of deficit was never matched by any country. While the number seems alarming, some experts say it is nothing to be intimidated by.  

“While 34 trillion dollars out of context seems like an unbelievable amount of money, the U.S. national annual GDP is around $25 trillion,” Nick Malinak, History Fellow, said. 

This means that while the public may be surprised when hearing such a number, the overall debt is not much higher than how much the US economy produces in a year. 

Another issue with the debt may be caused by holders of U.S. debt, especially if the U.S. owes a large amount of debt to countries with a less-than-stellar relationship.  Malinak, however, disagrees. 

“Only a third of the debt is owed to anyone outside the U.S.” Malinak said. A third is owed to the people of the US, while another third is owed to different sections of the government. The government practically owes itself around $11.3 trillion of its own debt. 

Over the course of several decades, the U.S. ran large yearly deficits, resulting in the current position of the national debt. According to Ari Baum, Carl W. Knobloch Instructor of Economics, “The US has been running a heavy-handed deficit, where the government spends much more money than they have on projects, which accrues all of this debt. 

Kris Donaldson, Colhoun Financial Literacy Coordinator, outlined how an issue like the national debt can affect the average American.  

“The high amount of debt might influence the willingness of the average American to invest or spend money, and will heavily decrease the trust they have for their government,” Donaldson said.  

However, Malinak disagreed, mentioning that the current standing of the national debt “doesn’t really affect the average person in really any heavy way in this current moment”. 

In addition, government inaction on the debt now may cause unforeseen problems for future generations.  

“Politicians think more about the now than the future and would rather not have to show people that for the economy and debt to be stable, taxes would actually have to go up to cover this debt,” Baum said. “By avoiding a tax increase now, politicians will cause a much bigger tax increase in the future, maybe even a few years down the line.” 

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