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Five Facts on the National Debt


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Real Clear Policy

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New nonpartisan reports on the soaring national debt are highlighting long-term concerns over the stability of our nation’s finances. Experts warn that this instability poses a direct threat to economic growth, as increased borrowing costs could lead to higher interest rates for consumers, stifling innovation and investment.

Here are Five Facts on the national debt.

  1. New analysis by the Congressional Budget Office shows national debt levels rising to 166 percent of GDP by 2054.

A higher debt-to-GDP ratio provides a snapshot of a nation’s overall fiscal health and its ability to pay back its debts. The debt-to-GDP ratio sat at 97 percent at the end of fiscal year 2023. According to the Committee for a Responsible Federal Budget, a debt-to-GDP ratio of 166 percent would be double the level before the start of the COVID-19 pandemic.

  1. Recent simulations by Bloomberg show an 88 percent chance that the debt-to-GDP ratio remains “on an unsustainable path.”

Bloomberg analysts noted that this outcome was a particular concern due to the fact that the U.S. economy is already at record low levels of unemployment and seeing solid rates of growth – meaning there are few opportunities to grow the economy much faster than current rates. Leading figures in the financial industry have been sounding the alarm on the growing debt, including BlackRock CEO Larry Fink, who recently called the debt crisis “more urgent” than any other time he could remember.:snip:

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