The US government’s debt just hit a new record high, adding a whopping $204 billion in just 24 hours on the first day of the new fiscal year.
Debt on the Rise
The national debt jumped from $35.46 trillion on September 30th to $35.67 trillion on October 1st. This huge increase is a sign that the government is spending more than it’s taking in.
Budget Deficit Balloons
The government’s budget deficit, the difference between spending and revenue, reached $1.897 trillion by the end of August. That’s a 24% increase from the previous year.
Why is the Debt Growing?
The Congressional Budget Office (CBO) says the rising debt is due to a number of factors, including:
- Higher spending on Social Security and Medicare: More people are receiving benefits, and the cost of these programs is going up.
- Increased Department of Defense spending: The government is spending more on military operations and research.
- Higher interest payments: The government is paying more interest on its existing debt due to rising interest rates.
The CBO points out that spending on Social Security increased by $98 billion due to higher benefit payments and more beneficiaries. Medicare spending went up by $76 billion
because of increased enrollment and higher service costs. The Department of Defense also saw a significant increase in spending, with $52 billion more going towards operations, maintenance, and research.
These rising costs are putting a strain on the US economy, and the government will need to find ways to reduce spending or increase revenue to get the debt under control.
