America’s Growing Debt (Part I)
The Rapid Accumulation of National Debt and Government Waste: A Dual Challenge
Over the past four years, the United States has witnessed a significant surge in its national debt, with the total public debt outstanding increasing by approximately $8.65 trillion. This rapid accumulation mirrors the debt growth observed over the entire preceding decade, underscoring the unprecedented fiscal challenges faced recently.
Key Drivers of Recent Debt Accumulation:
COVID-19 Pandemic Response: The onset of the COVID-19 pandemic in 2020 necessitated substantial government intervention to mitigate economic fallout. The Coronavirus Aid, Relief, and Economic Security (CARES) Act, enacted in March 2020, alone accounted for an estimated $1.8 trillion increase in federal deficits over the 2020-2030 period.
Increased Federal Spending: Beyond pandemic-related expenditures, there has been a notable rise in federal spending on social programs. In fiscal year 2024, Social Security expenditures reached $1.46 trillion, while health-related spending amounted to $912 billion. Additionally, gross interest payments on the national debt surpassed the $1 trillion mark for the first time, reflecting the growing cost of servicing the debt.
Tax Policies and Economic Measures: Tax cuts implemented in prior years, without corresponding reductions in spending, have further exacerbated the deficit. The combination of reduced revenue and sustained or increased expenditures has contributed significantly to the burgeoning national debt.
Implications of the Growing National Debt:
Interest Payments Surpassing Major Expenditures: The cost of servicing the national debt has escalated to the point where interest payments now exceed spending on critical programs like Medicare and national defense. In the first seven months of the fiscal year, interest payments totaled over $500 billion, equating to approximately $4,000 per household.
Economic Constraints: The escalating debt limits the government's fiscal flexibility, potentially hindering its ability to respond to future economic crises or invest in essential infrastructure and services.
Political Discourse: Despite the mounting debt, recent political campaigns have largely overlooked this pressing issue, with candidates proposing further spending increases or tax cuts without addressing the underlying fiscal imbalance.
Exorbitant Waste:
Government spending in areas that many might deem unnecessary or extravagant has further strained the national budget. Here are some notable examples from the Festivus Report:
Over $10 billion on underused federal office buildings.
$12 million for a Las Vegas pickleball complex.
$1.5 million to study lonely rats' cocaine preferences.
$720,479 for wetland conservation for ducks in Mexico.
$4.8 million spent on Ukrainian influencers.
$2.1 million for Paraguayan border security while U.S. border issues persist.
$500,000 for a U.S.-Ethiopia PR campaign.
$1.5 million on motion sickness studies using kittens.
$15.5 billion promoting electric vehicles, despite consumer resistance.
Nearly $400,000 on a podcast exploring "magic in the U.S.".
$365,000 for circus arts in public parks.
$7 million across various "magical" or artistic federal projects.
A Florida man stole $8 million in COVID-19 relief to buy an island.
A failed trucking company received $700 million under pandemic relief programs.
Questionable Foreign Aid:
$123,066 spent by the Department of State (DOS) to teach Kyrgyzstan youth how to go viral.
$20 million on "Ahlan Simsim," a new Sesame Street show in Iraq by USAID.
$2.1 million in aid to help Paraguay build a border wall.
$20 million by the Department of Agriculture (USDA) on the Fertilize Right Initiative to advance fertilizer use in Pakistan, Vietnam, Colombia, and Brazil.
Impact of Debt:
Americans paid $892 billion in interest on national debt in FY 2024, with projections of $1 trillion annually by 2025.
Comparative Analysis:
To put these expenditures into perspective, let's compare them with the costs of other significant economic indicators:
The $15.5 billion spent on promoting electric vehicles is approximately three times the annual budget of the National Aeronautics and Space Administration (NASA).
The $12 million spent on the Las Vegas pickleball complex could fund the salaries of over 200 public school teachers for a year.
The $1.5 million to study lonely rats' cocaine preferences could cover the annual tuition for around 200 college students.
Magnitude of Recent Debt Accumulation:
The fact that the U.S. accumulated nearly a decade's worth of debt growth in just four years is a stark reminder of the urgency required in addressing this issue. This pace of debt growth is unprecedented in modern history and reflects the significant economic challenges and policy decisions made in response to recent crises. If this trend continues, the long-term economic consequences could be severe, impacting future generations and the nation's ability to invest in critical areas.
Conclusion:
The rapid accumulation of national debt in the past four years, equating to nearly a decade's worth of debt growth, poses significant challenges to the U.S. economy. Addressing this issue requires a balanced approach that considers both revenue generation and prudent spending to ensure fiscal sustainability for future generations.
Sources:
1. The Balance - U.S. National Debt by Year https://www.thebalancemoney.com/national-debt-by-year-compared-to-gdp-and-major-events-3306287
2. Macrotrends - National Debt Growth by Year https://www.macrotrends.net/2496/national-debt-growth-by-year
3. Investopedia - U.S. National Debt by Year https://www.investopedia.com/us-national-debt-by-year-7499291
4. Cato Institute - The Impact of Public Debt on Economic Growth https://www.cato.org/cato-journal/fall-2021/impact-public-debt-economic-growth
5. Wharton Budget Model - When Does Federal Debt Reach Unsustainable Levels? https://budgetmodel.wharton.upenn.edu/issues/2023/10/6/when-does-federal-debt-reach-unsustainable-levels
6. St. Louis Fed - Making Sense of the National Debt https://www.stlouisfed.org/publications/page-one-economics/2019/11/01/making-sense-of-the-national-debt
7. ABC News - How US national debt grew to its $31.4 trillion high https://abcnews.go.com/Politics/us-national-debt-grew-314-trillion-high/story?id=99429867
8. Up To Us - The U.S. National Debt Explained in 1 Minute https://www.youtube.com/watch?v=2ydLs7DeTOs
9. Dr. Paul Releases 2024 ‘Festivus’ Report on Government Waste https://www.hsgac.senate.gov/media/reps/dr-paul-releases-2024-festivus-report-on-government-waste/
10. The Festivus Report 2024 - hsgac.senate.gov https://www.hsgac.senate.gov/wp-content/uploads/FESTIVUS-REPORT-2024.pdf
11. Sen. Rand Paul releases annual 'Festivus' report on government waste https://highlandcountypress.com/news/sen-rand-paul-releases-annual-festivus-report-government-waste
12. Kentucky Sen. Rand Paul Reveals Annual “Festivus” List Of Over $1 Trillion In Government Spending https://wsau.com/2024/12/26/kentucky-sen-rand-paul-reveals-annual-festivus-list-of-over-1-trillion-in-government-spending/
13. The Paul Festivus Report: A Great Start for DOGE https://www.theamericanconservative.com/the-paul-festivus-report-a-great-start-for-doge/
14. Sen. Rand Paul Highlights $1 Trillion in Government Waste in Festivus Report #RandPaul #Government https://www.youtube.com/watch?v=Bd4DzuFpod0
15. All I Want For Christmas...and It's None of This. 2024 Festivus Report https://www.youtube.com/watch?v=1DuWcrKk7Rc
16. Rand Paul details how the Biden admin wasted $1 trillion https://www.msn.com/en-us/video/news/rand-paul-details-how-the-biden-admin-wasted-1-trillion/vi-AA1wqFUe