For ordinary Americans, deficit spending just isn't an option, and getting yourself into huge amounts of debt is a recipe for financial disaster. However, the U.S. government has had no qualms about continually spending more than it brings in, and regardless of whether Republicans or Democrats have controlled the White House and Congress, the trend for the national debt has been unquestionably on the upswing.
The Treasury Department recently reported its latest information on the size of the public debt. As of the end of the government's 2019 fiscal year, which ended on Sept. 30, the total amount that the U.S. government had borrowed rose to $22.687 trillion. That was up by roughly $1.17 trillion from the end of fiscal 2018, marking the second straight year that the national debt had risen by more than $1 trillion.
Data source: U.S. Treasury. Chart by author.
Sadly, it looks as though the trend toward rising debt levels is likely to accelerate into the next decade. According to the nonpartisan Congressional Budget Office, budget deficits are likely to average $1.2 trillion between 2020 and 2029, as tax cuts on corporations and individual taxpayers reduce revenue even as most government programs see rising spending needs. Although there's a lot of debate in the current presidential election campaign about whether tax rates should rise from current levels, most candidates who favor tax increases propose taking the additional tax revenue stemming from their proposals and spending it on other initiatives rather than applying it toward slowing the rise in the national debt.
Just about the only good news with the national debt is that the recent move lower in interest rates promises to make it less costly for the federal government to finance its outstanding borrowings. However, those low rates have resulted in part from expectations that the U.S. economy could see growth slow, and that could reduce tax revenue from businesses and workers even further. If the national debt is rising this fast even under strong conditions, it's alarming to think what might happen the next time a recession hits.
