Presidential and congressional candidates must address the national debt

Last week, the U.S. Treasury announced that the gross national debt reached $35 trillion – that’s more than $266,000 per U.S. taxpayer. To put it in perspective, it would take 22 years to pay off this debt if every family in the country donated $1,000, per month.

Worse, it is projected to double over the next 10 years!

Folks, this is a national crisis.

From 2015-2023 I had the opportunity to serve as Gov. Larry Hogan’s secretary of Budget and Management. When we took over, our first order of business was to stop digging ourselves deeper into debt.  We understood that the increasing state debt was a bipartisan problem that required us to work across the aisle to achieve success.

Now, with less than 100 days until America decides who will win the White House and both chambers of Congress, you would expect candidates to be discussing our historic national debt – and how to shrink it – at every stop on the campaign trail.  Sadly, that’s far from the case. And it’s a disgrace, especially given the opportunities the federal government will have in 2025 to either stem the bleeding or send us even further into the red.

America’s federal budget deficit in 2023 reached $1.7 trillion, an all-time high outside of a recession or national emergency, and this number is projected by the nonpartisan Congressional Budget Office to be nearly $2 trillion in a couple of years. The numbers can be difficult to even comprehend. For example, there are 12 zeros in a trillion dollars. But the effects are very real.

The Committee for a Responsible Federal Budget estimates that every $1 of new U.S. government borrowing reduces total investment in the economy by 33%. And our insatiable appetite for spending has contributed to the generationally high interest rates and inflation we have witnessed recently.

As high deficits continue over the course of the 2020s, we are expected to add $24 trillion to the national debt by 2034. The interest we pay for the privilege of spending more than we take in is the fastest growing part of the budget, almost $900 billion this year. That’s more than we’ll spend on defense, Medicare, or all spending on programs for children.

The debt squeeze also risks our national and domestic security, hindering the federal government’s ability to respond to a domestic or international crisis at a very dangerous time in world affairs.

One of the biggest contributors to the national debt is Social Security and Medicare, which are expected to become insolvent by 2033 and 2036, respectively. As our nation’s life expectancy increases and the “baby boomer” generation approaches and enters retirement, the Social Security Trust Fund’s revenue will not be able to pay out full benefits to retirees.

This is not a theoretical problem. When those trust funds are empty, there will be an automatic 21% reduction in Social Security benefits and an 11% reduction in payments to hospitals – likely driving a number of these institutions out of business.

The next time you hear a candidate declare that they will not touch Social Security or Medicare, remember that this pledge is a guarantee that these essential programs will go broke.

Voters have become so numb to the federal debt that we imagine it is just something we have to live with. In reality, it threatens our way of life. Unchecked, the current trajectory could lead to other countries no longer considering the dollar as the international currency of choice, a cataclysmic development that would cripple our financial institutions, throw markets into chaos and make borrowing even more onerous.

Unfortunately, the problem is so large that it is actually unreasonable to expect Congress to produce a balanced budget in the short term. A more feasible goal is to stabilize the debt where it currently stands, at almost 100% of our Gross Domestic Product – the annual output of the nation’s economy.

That would require debt increases that are aligned with economic growth. If the economy grows at 3%, and our deficit increases by 3% of GDP, the problem is at least not getting worse. Then we can start to put the debt on a negative path.

Fiscal issues will dominate the agenda in 2025. Trump-era tax cuts are set to expire and the debt ceiling will need to be raised. And the slow march to insolvency will continue for Social Security and Medicare.

On each of these issues, and many more, your representatives will have a choice; continue digging the hole or start the long process of filling it in. You can let them know which one you prefer by asking how they would tackle the issue and, depending on their answer, voting accordingly. Our future depends on it.