TLDR
- The U.S. national debt has surpassed $35 trillion for the first time.
- Since 2020, the U.S. has added about $12 trillion in federal debt.
- The Congressional Budget Office projects the national debt to reach $56 trillion by 2034.
- Some suggest a strategic Bitcoin reserve could help address the debt issue.
- The debt-to-GDP ratio is expected to break a nearly 80-year-old record in 2027.
The United States has reached a new milestone in its financial history. For the first time ever, the national debt has surpassed $35 trillion.
This number, reported by the Treasury Department, highlights the ongoing financial challenges faced by the world’s largest economy.
Since January 2020, the U.S. has been adding debt at an average rate of $280 billion per month. In total, about $12 trillion has been added to the federal debt in just over four years.
To put this in perspective, the current debt amounts to around $105,000 for every person living in the United States.
BREAKING: Total US Federal debt has officially hit $35 trillion for the first time in history.
Since 2020, the US has now added ~$12 TRILLION in Federal debt.
In other words, the US has added an average of ~$280 BILLION of Federal debt EVERY MONTH since January 2020.
This… pic.twitter.com/YRQjNkQopc
— The Kobeissi Letter (@KobeissiLetter) July 29, 2024
Looking ahead, the situation appears likely to worsen. The Congressional Budget Office (CBO) projects that by 2034, the national debt could reach a staggering $56 trillion.
This increase is driven by rising spending, particularly on programs like Social Security and Medicare, as well as high interest rates that make servicing the debt more expensive.
The debt issue has caught the attention of politicians and financial experts alike. Maya MacGuineas, president of the Committee for a Responsible Federal Budget, called the news “incredibly sobering.”
She emphasized the need for serious action to address the growing debt, even in an election year.
The cryptocurrency community has also weighed in on the debt crisis. Some proponents suggest that a strategic Bitcoin reserve could help tackle the national debt.
Senator Cynthia Lummis of Wyoming stated,
“A strategic Bitcoin reserve could stop this runaway train and help pay down the national debt for our future generations.”
Today, the national debt has passed a staggering $35 trillion.
A strategic Bitcoin reserve could stop this runaway train and help pay down the national debt for our future generations.— Senator Cynthia Lummis (@SenLummis) July 30, 2024
However, it’s important to note that using Bitcoin to reduce national debt would likely involve selling the cryptocurrency, which could have significant impacts on the crypto market.
The U.S. government has already been selling some of its Bitcoin holdings, and even small movements can cause ripples in the crypto world.
The debt situation is also affecting how economists view the U.S. economy’s health. The debt held by the public, which excludes intragovernmental holdings, is projected to reach 99% of the U.S. gross domestic product (GDP) this year.
By 2027, it’s expected to exceed 106% of GDP, breaking a record set in 1946 after World War II.
Despite the growing concern, the issue of national debt has not been a major focus in the current presidential campaign. Both leading candidates, Kamala Harris and Donald Trump, have said little about addressing the nation’s huge deficits.
As the debt continues to grow, it raises questions about the long-term financial stability of the United States. While solutions like a Bitcoin reserve have been proposed, the path forward remains unclear.
What is certain is that the national debt will likely continue to be a significant economic issue for years to come.
