Why The U.S. Won’t Pay Down Its Debt
CNBC・2 minutes read
The US national debt is nearly $33 trillion, consisting of $7 trillion intragovernmental debt and $25.7 trillion held by the public, with economists and politicians warning against the potential harm to the economy and emphasizing the importance of considering interest rates and economic growth for debt sustainability. Public debt, in the form of government securities like Treasury bonds, is utilized for emergencies and to prevent taxing the current generation excessively, with the debt to GDP ratio serving as a key indicator of debt serviceability.
Insights
- The US national debt stood at almost $33 trillion in September 2023, comprising $7 trillion in intragovernmental debt and $25.7 trillion held by the public, illustrating the magnitude and complexity of the country's financial obligations.
- Economists and policymakers stress the significance of monitoring interest rates and economic growth concerning the national debt to avert potential economic repercussions, highlighting the delicate balance required for sustainable debt management and future financial stability.
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Recent questions
What is the US national debt?
The US national debt was nearly $33 trillion as of early September 2023, with $7 trillion being intragovernmental debt and $25.7 trillion held by the public.
How does the national debt impact the economy?
Economists and politicians caution that the expanding national debt could harm the economy, emphasizing the importance of considering interest rates and economic growth for debt sustainability.
What is public debt used for?
Public debt, in the form of government securities like Treasury bonds, is used for emergencies and to avoid burdening the current generation with taxes, with the debt to GDP ratio being a critical indicator of debt serviceability.
What are the concerns about the national debt?
Economists and politicians caution that the expanding national debt could harm the economy, emphasizing the importance of considering interest rates and economic growth for debt sustainability.
What is the debt to GDP ratio?
The debt to GDP ratio is a critical indicator of debt serviceability, comparing the national debt to the country's economic output.
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Summary
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"US National Debt: Impact, Sustainability, Concerns"
- The US national debt was nearly $33 trillion as of early September 2023, with $7 trillion being intragovernmental debt and $25.7 trillion held by the public.
- The national debt is essentially an accounting record tracking the government's economic impact by adding and subtracting dollars through taxation.
- Economists and politicians caution that the expanding national debt could harm the economy, emphasizing the importance of considering interest rates and economic growth for debt sustainability.
- Public debt, in the form of government securities like Treasury bonds, is used for emergencies and to avoid burdening the current generation with taxes, with the debt to GDP ratio being a critical indicator of debt serviceability.
