The U.S. debt has been climbing at a staggering rate for quite some time. But a recent and shocking revelation has been released by the Treasury Department which shows the government is set to borrow almost 1 trillion dollars this year. To shed some context on the situation, that is a %84 increase of fiscal debt in Trump’s first fiscal year as president.
The exact numbers show the United States on track to spend $955 billion this year as opposed to 2017’s $519 billion; almost a 2 fold increase in debt and a %84 increase in spending. Marc Goldwein, a senior policy director for responsible government spending reports that the government is simply addicted to debt and blames both parties for the complete misuse and poor handling of the countries finances. Goldwein goes as far as to state that it’s upsetting that Trump did not mention anything about the major increase in government spending at his ‘State of the Union Adress’ and foresees the U.S. encountering major financial trouble and economic fallout in the near future.
Sporadic and careless government spending has also affected the interest rates charged on government bonds, the highest since 2014, which could easily lead to inflation. This has caused a panic to ripple through the stock market which has caused a recent landslide sell-off, the biggest sell-off to take place in 2 years.
In years past, it was easy to overlook debt and over-spending due to the fact that investors were willing to keep purchasing stocks and bonds from the federal government. But as inflation looms as a very real possibility in the future, investors are likely to sell their stocks in favor of better and more stable investments. The federal reserve was formerly purchasing government debt as a means to provide the perception of a stable economy and provide a foundation to increase demand. But as the economy improves, the federal reserve has ceased this activity, leaving the treasury searching for investors as the national debt spirals out of control.
Todeschi, Obamas treasury advisor says that while the increase in government spending is a big risk, he does not believe it to be detrimental to the financial health of the United States economy.
Trump’s future plans for 2019 and 2020 show an increase in debt above the already staggering numbers that loom over 2018. While Trump claims to be the king of debt, spending under his supervision has shown only an increase regardless of his former promises to reduce the national debt.
Both parties and respective policy-makers continually claim that “this” is the last time they will raise the debt. Yet as a testament to the behaviors of addiction, they continue to make poor economic decisions and pass policies that repeatedly further the burden of debt upon the United States.
It seems to be all talk and no show which has become a mainstay of American Politics. While many repeatedly promise to heal the debt burden, actions only show a willingness to spend more money. So the question that looms in the dark distance beckons; will we harness our addiction under our own accord and heal our country, or will we stop spending only due to economic collapse and our inability to spend any more?