US government federal debt has breached an unflattering milestone, topping $34 trillion for the first time in history and amounting to more than double the total of the world’s next-biggest borrower, China.
The US Treasury Department disclosed the new debt total on Tuesday, saying it exceeded the $34 trillion mark by nearly $1.5 billion as of December 29, the last business day of 2023. The amount owed had increased by $90 billion since just the previous day.
Washington’s public debt now amounts to about $102,000 for every man, woman and child in the US, or nearly $260,000 per household. The total US federal debt is roughly equivalent to the economies of China, Germany, Japan, India and the UK combined, as pointed out by the Peter G. Peterson Foundation, a nonpartisan fiscal policy group in New York.
“We are beginning a new year, but our national debt remains on the same damaging and unsustainable path,” foundation CEO Michael Peterson said. He added, “Adding trillion after trillion in debt, year after year, should be a flashing warning sign to any policymaker who cares about the future of our country.”
By comparison, China owed around $14 trillion in government debt as of last year, according to an IMF estimate. US government debt is approximately equal to the combined totals for the world’s next five biggest borrowers – China, Japan, the UK, France and Italy. US debt as a percentage of GDP is over 123%, compared with China’s 83%. Japan has the largest debt burden relative to GDP, at 255%.
The amount the US government owes lenders has increased by $6.25 trillion, or 23%, since President Joe Biden took office three years ago. To put that in perspective, it took about 225 years from the nation’s founding to approach $6 trillion in public debt. The growth in debt has accelerated rapidly in the past two decades. It jumped by more than $9 trillion during Barack Obama’s eight years as president, then increased by $7.8 trillion during Donald Trump’s four-year term.
Interest costs on the US debt rose to $659 billion in the government’s last fiscal year, about double the entire federal budget of Russia. Interest payments will total an estimated $750 billion this year, or over $2 billion per day.
Biden has repeatedly made false claims about having cut the US debt. The annual budget deficit – the extent to which government spending exceeds revenue – shrank by $1.7 trillion during his first two years in office, reflecting the absence of Covid-19 stimulus spending, but it’s projected to surge this year. The US hasn’t spent less than its government revenue in 20 years.