U.S. debt tops $38 trillion for the first time, worsened by government shutdown
The U.S. National Debt Surpasses $38 Trillion Amid Government Shutdown
Recent data from the U.S. Treasury Department reveals that the gross national debt of the United States has exceeded $38 trillion for the first time. This milestone comes at a time when the government is experiencing a shutdown, causing disruption to the economy and leaving hundreds of thousands of federal workers unpaid.
Government shutdowns have a direct impact on the national debt as they lead to delays in economic activity and fiscal decision-making. The Office of Management and Budget estimated that the 2013 government shutdown resulted in a $2 billion loss in worker productivity.
Michael A. Peterson, CEO of the Peter G. Peterson Foundation, expressed concern over the country’s mounting debt during a government shutdown. He highlighted the lack of fiscal responsibility among lawmakers and the alarming rate at which the debt is increasing.
The longest government shutdown in U.S. history, which occurred in 2018 and lasted 35 days, cost the economy $11 billion primarily due to reduced spending by federal workers. This highlights the economic impact of such disruptions.
A survey conducted by the Peterson Foundation in September found that 81% of voters considered the national debt to be a significant issue. Economists warn that the growing debt will lead to higher interest costs for the government, potentially limiting public and private spending in key economic sectors.
Moody’s, a leading credit rating agency, downgraded the U.S. credit rating in May, citing concerns over the country’s escalating debt. Other major rating agencies, including Standard & Poor’s and Fitch Ratings, have also revised their ratings downward.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, expressed worry about the national debt surpassing $38 trillion. She emphasized the urgency of addressing long-term fiscal challenges such as the depletion of trust funds for programs like Social Security and Medicare.
