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US Debt
US national debt reached record USD 37 trillion. The national debt eclipsed this new milestone years sooner than pre-pandemic projections. The Congressional Budget Office's January 2020 projections predicted the US reaching the milestone after fiscal year 2030. But the debt grew faster than expected as the COVID-19 pandemic shut down much of the US economy and the Trump and Biden administrations borrowed heavily to stabilise the national economy.
The US government's gross national debt has surpassed USD37 trillion, a record number that highlights the accelerating debt on America's balance sheet and increased cost pressures on taxpayers. The USD37 trillion update is found in the latest Treasury Department report issued Tuesday which logs the nation's daily finances. The national debt eclipsed USD37 trillion years sooner than pre-pandemic projections. The Congressional Budget Office's January 2020 projections had gross federal debt eclipsing USD37 trillion after fiscal year 2030. But the debt grew faster than expected because of a multi-year COVID-19 pandemic starting in 2020 that shut down much of the U.S. economy, where the federal government borrowed heavily under then-President Donald Trump and former President Joe Biden to stabilise the national economy and support a recovery. And now, more government spending has been approved after Trump signed into law Republicans' tax cut and spending legislation earlier this year. Th
US Treasury Secretary Janet Yellen said her agency will need to start taking extraordinary measures, or special accounting maneuvers intended to prevent the nation from hitting the debt ceiling, as early as January 14, in a letter sent to congressional leaders Friday afternoon. "Treasury expects to hit the statutory debt ceiling between January 14 and January 23," Yellen wrote in a letter addressed to House and Senate leadership, at which point extraordinary measures would be used to prevent the government from breaching the nation's debt ceiling which has been suspended until Jan 1, 2025. The department has in the past deployed what are known as extraordinary measures or accounting maneuvers to keep the government operating. But once those measures run out the government risks defaulting on its debt unless lawmakers and the president agree to lift the limit on the US government's ability to borrow. "I respectfully urge Congress to act to protect the full faith and credit of the ..
The Congressional Budget Office is giving the world a concerning look at the US government's ledgers: ever higher deficits, greater government spending and tax revenues that only begin to increase when existing tax cuts expire. The nonpartisan agency estimates in its latest 30-year outlook, released Wednesday, that publicly held debt will be equal to a record 181 per cent of American economic activity by 2053. That compares with a projected 98 per cent at the end of this budget year, a sign the government is getting more dependent on debt to pay for Social Security, Medicare, the military, infrastructure and an array of programs that benefit millions of households. The higher debt load is not all that shocking given the deficit spending of the past two decades. But the CBO figures do offer a bit of comfort in that annual deficits after 2042 are lower than forecasted in the agency's report from last year. This is because the primary borrowing and interest rate costs are lower than wha
President Joe Biden tried to reassure world leaders on Saturday that the United States would not default as he consulted with the heads of Australia, Japan and India in a meeting of the so-called Quad partnership that had been hastily rescheduled because of the debt limit standoff back in Washington. Hoping to avert an outcome that would rattle the global economy and prove to be a boon to Beijing, Biden opened his third day in Japan at the annual Group of Seven meeting of the world's most powerful democracies with a briefing from his staff on the latest fits and starts in talks over how to raise the federal debt limit. The president also squeezed in meetings aimed at challenging China's buildout across the Indo-Pacific. The Quad members originally had planned to meet in Sydney next week, but got together instead on the sidelines of the G7 so Biden could return to Washington earlier on Sunday in hopes of finalising a deal to increase the U.S. borrowing limit before the government run
Facing the risk of a an unprecedented U.S. government default by month's end, President Joe Biden has invited the top four congressional leaders to face-to-face talks at the White House next week. It's the first concrete step toward negotiations on averting a potential economic catastrophe, but there's a long way to go: Biden and Republicans can't even agree on what's up for negotiation. WHAT'S THE PROBLEM? If the government's legal borrowing limit of $31.4 trillion is not raised or suspended in the next few weeks, the result could be financial havoc. If the government can't borrow money to keep paying its bills for an extended period, there could be millions of job losses, businesses left bankrupt, crashes piling up across financial markets and lasting economic pain. The damage would be financial, but the cause would be political, a breakdown between Republicans and Democrats, rather than a problem with the underlying health of the U.S. economy. The scheduling of next Tuesday's Wh
President Joe Biden has sought to ease a debt limit standoff by inviting the four Congressional leaders to the White House on May 9 signalling the growing fears of a default as the federal government might be unable to pay its bills as soon as June 1. Administration and congressional officials confirmed the individual calls to lawmakers and the meeting date, insisting on anonymity to discuss the plans. Sen. Minority Leader Mitch McConnell, R-Ky., said he spoke with Biden and expects to speak with him again, though he did not say whether he will attend the meeting. Biden plans to stress that Congress must take action to avoid default without conditions and will discuss the urgency of preventing default, as well as how to begin a separate process for passing a separate fiscal 2024 budget. But if even the lawmakers talk, there is no guarantee of progress on an issue that has revealed a gulf in how Democrats and Republicans think the country should be governed. Biden and House Speaker
Treasury Secretary Janet Yellen has notified Congress that the US is projected to reach its debt limit as early as June 1, if the body does not raise or suspend the debt limit before then. In a letter to House and Senate leaders, Yellen urged Congress to protect the full faith and credit of the United States by acting as soon as possible to address the USD 31.4 trillion limit on its legal borrowing authority. We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States," she said in the letter. The Treasury said on Monday it plans to increase its borrowing during the April to June quarter of this year, even as the federal government is close to breaching the debt limit. The US plans to borrow USD 726 billion during the quarter. That's USD 449 billion more tha