The U.S. national debt hit a new milestone, surpassing $30 trillion, according to data released by the U.S. government’s Treasury Department on Tuesday. Financial experts cited by US media such as CNN and Axios are still divided on “how much debt is too much” and how big an issue this really is for the country, but they all agree on one thing – the latest debt milestone is here A delicate transition period for U.S. fiscal and monetary policy, where borrowing costs are expected to rise and have broader effects on the economy.
Total outstanding public debt stood at $30.1 trillion as of Jan. 31, up nearly $7 trillion from what the country owed lenders in late January 2020 before the pandemic hit the economy, U.S. Treasury data showed.
There are many reasons behind the surge in public and intra-government debt in Washington — one of which is increased government spending during the Covid-19 pandemic. It is during this period (since late 2019) that the federal government has borrowed nearly $7 trillion from foreign investors, led by Japan and China, that will eventually need to be repaid, according to CNN.
Another reason cited by U.S. financial experts is the gradual accumulation of national debt since the 2008 financial crisis, nearly a decade before the pandemic.
In December 2007, just as the global recession known as the Great Recession began, the U.S. national debt outstanding hit $9.2 trillion. According to CNN, when Donald Trump became president of the United States, the country’s national debt was already as high as $20 trillion.
Revenue losses from the 2017 Trump Administration’s Tax Cuts and Jobs Act (TCJA) tax cuts will add about $1-2 trillion to the federal government between 2018 and 2025, according to the Tax Policy Center. Debt, deficit increases could be exacerbated several times by the pandemic.
During the Biden administration, Congress also approved trillions of dollars in pandemic plans to support small businesses, unemployed workers and their families and other groups.
Complete News Source : Hindustan Times
