US national debt: Nation’s gross national debt has surpassed $31 trillion!

The country’s total national debt has exceeded $31 trillion, according to a US Treasury report released Tuesday that records America’s daily financial data.

The debt numbers approached the legal ceiling of nearly $31.4 trillion – an artificial limit imposed by Congress on the US government’s ability to borrow – and the debt numbers hit an already weak economy facing high inflation, high interest rates and a strong dollar.

While President Joe Biden touted his administration’s efforts to cut the deficit this year and recently signed the so-called Inflation Cuts Act, which attempts to tame the 40-year-old price increases caused by a variety of economic factors, economists say the latest debt numbers are cause for concern.

Higher interest rates will exacerbate the country’s growing debt problems and make the debt itself more expensive, said Owen Zedar, an economist at Princeton University. The Federal Reserve has raised interest rates several times this year in an effort to combat inflation.

Zedar said the debt “should encourage us to think about some tax policies that have almost gone through the legislative process but haven’t gotten enough support,” such as higher taxes on the wealthy and closing the carry-on interest loophole, which allows money managers to treat income as capital gains.

“I think the point here is that if you weren’t worried about debt before, you should be — and if you were worried before, you should be more worried,” Zedar said.

Earlier this year, the Congressional Budget Office released a report on the burden of the US debt, warning in its 30-year forecast that if the debt is not addressed, debt will soon rise to new highs that may eventually endanger the US economy.

In its mid-session review for August, the administration projected the budget deficit for this year to be about $400 billion less than it forecast in March, due in part to stronger-than-expected revenue, lower spending, and an economy that has restored all jobs. It was lost during the multi-year pandemic.

The Office of Management and Budget said in August that this year’s full deficit would be reduced by $1.7 trillion, the largest single reduction in the federal deficit in American history.

“This is a new record that no one should be proud of,” Maya McGuinness, chair of the Committee on Responsible Federal Budget, said in an emailed statement on Tuesday.

“In the last 18 months, we’ve seen inflation hit a 40-year high, interest rates hiked in part to combat that inflation, and a lot of off-budget legislation and enforcement action,” McGuinness said. We are addicted to debt.

A representative from the Treasury could not be reached for comment.

“It has taken 200 years to amass its first trillion dollars in national debt, and since the pandemic we have added 1 trillion roughly every three months,” said Seung-Won Sohn, professor of economics at Loyola Marymount University.

Expecting inflation to rise in the “foreseeable future”, he said: “When you increase government spending and money supply, you will pay the price later.”