The United States national debt officially surpassed $37 trillion August 11. This big milestone has sparked conversations among economists, policymakers and everyday citizens. In less than 60 days the federal government borrowed over $800 billion, increasing the debt to this shocking level. The national debt is approaching $33 trillion and it’s about more than just a big number. This increasing burden will hurt the future generations the most.
This impressive debt growth trajectory naturally leads to concerns about the longer-term sustainability of current fiscal policy. We just crossed this threshold nationally with the debt exceeding $34 trillion in January 2024, and then exceeding $35 trillion in November 2024. Just last week, we saw the debt go from $35 trillion to $36 trillion in a mere 188 days. It took another 265 days for it to reach $37 trillion. Just in July, interest cost taxpayers over $91.9 billion on the national debt alone. This price surge is likely to bring total interest for the fiscal year above $1.01 trillion.
It’s hard to overstate how big $1 trillion is. Picture this, take a stack of one trillion dollar bills. That tower would have to measure an incredible 67,866 miles into the sky to reach that height, far surpassing any structure on our planet. So let’s unpack what that means. If you could say one number per second, it would take over 11.5 million days to count to one trillion!
Implications of a Growing Debt
The ramifications of such a high national debt are serious. If we follow the consumption narrative, a latte is $3. Surprisingly fun to try to wrap your head around, with one trillion dollars you could buy an astonishing 333 billion cups! This highlights not only the vastness of the amount but its potential impact on everyday life and consumer spending.
Additionally, if a person owned one trillion dollars, they would be able to give each of the earth’s inhabitants about $125. These types of distributions highlight the inequality that is present within global economies. If you put dollar bills end-to-end, they would reach the moon and back. With one trillion dollars, that trip would be made just over 203 times, illustrating the mind-boggling magnitude of that figure.
The concept of national debt has long been a heated point of debate among political leaders. As George Washington once remarked, nothing can be more important than regularly redeeming and discharging the public debt. In particular, he made clear that this financial burden is urgent. On none can delay be more fatal or an saving of time more precious. His words ring true today, as we are once again asked to set aside fiscal responsibility.
The Burden of Interest Payments
The cost of interest on this rapidly growing debt is becoming more and more unmanageable. As mentioned above, interest costs already hit an all-time record $91.9 billion just last month. Think about that for a moment – that’s like spending $1 million every day since Christ was born. Even at that, you’d still have a ways to go before you’d touched one trillion dollars.
Federal interest payments are fast becoming the largest existential threat to future budgets and our nation’s economic stability. As Thomas Jefferson warned, these kinds of financial burdens might constitute “the greatest of dangers to be feared.” His worries resound through centuries as statesmen contend with the dangers of overextending credit.
Another historical perspective comes from James Madison, who labelled national debt as “a public curse, and in a Rep. Govt. a greater than in any other.” These sentiments reflect ongoing worries about how an increasing national debt could affect democracy and governance in the United States.
Future Outlook
Moving forward, economists and policymakers need to pay more attention to what this increasingly harmful debt will mean for our children and grandchildren. At the same time, the federal government is facing unprecedented challenges in trying to balance the budget. Simultaneously, it needs to meet acute social demands and reinvest in its infrastructure.
And as citizens see their government borrowing at such historically alarming levels, the arguments for fiscal restraint are more important than ever. Despite the growing debt, under the current trajectory the national debt will continue to increase indefinitely. Major reform in fiscal policies is needed to reverse this trend.