Trump's debt bomb is ticking — and Americans will pay the price

President Donald Trump has led America into so much debt that it now exceeds the entirety of the nation’s gross domestic product, and one academic is warning that the bill is coming due.

“Unless we change course, the debt will only get worse—fast,” wrote Brookings Institution senior fellow William Galston for The Wall Street Journal on Tuesday. “The Congressional Budget Office estimates that we are on track to accumulate more than $24 trillion in debt over the next decade, for a total of $56 trillion—120 percent of estimated GDP in 2036.”

He added, “These numbers are so large that it is hard to grasp what they mean. One key measure is the cost of financing this swelling debt burden. Twenty-five years ago, interest payments on the national debt were 2 percent of GDP. This year they will claim 3.3 percent; a decade from now, 4.6 percent.”

Galston broke down the numbers in terms of how they will impact ordinary Americans. By 2036, the US will increase its spending on debt interest from $1 trillion to $2.1 trillion, amounting to nearly one-fifth of the total federal budget. This means that, by that time, “more than 2 out of every 3 dollars we borrow will go to finance interest on the debt. The longer this continues, the worse it gets.”

Because President Clinton worked with both parties in Congress so that by 2001 the debt had fallen to just 32 percent of GDP, Galston argued that the current crisis is not unsolveable. He expressed support for a recent bipartisan plan by 14 representatives, half from each party, to "commit the country to reduce the budget deficit to 3 percent of GDP and maintain it at or below this level."

While backing this target, however, Galston also urged pragmatism.

“A serious effort to slow and then halt the growth of public debt would involve reductions in popular programs, increased revenue from taxes as well as economic growth, and devolution of some federal programs to the states,” Galston wrote. “Given how hard-pressed working- and middle-class households are these days, wealthy Americans would have to bear a substantial share of the burden.”

He added, “A political version of the Hippocratic oath—first, do no harm—would be a good place to start. If the Trump administration wants to increase defense spending by more than $400 billion in the next fiscal year, it should specify how this can be done without increasing the deficit. The same holds for Democrats who want to increase domestic spending above current levels. If Congress isn’t willing to accept the needed offsets, it shouldn’t increase spending.”

Galston concluded, “None of this will happen without a president who is prepared to persuade the people that getting the debt under control is a top priority.”

Galston is not alone among budget hawks who are alarmed at the rising debt.

“Biden ramped up spending, especially on his way out the door,” Reason's Nick Gillespie wrote last month. “Trump is doing more of the same. Yes, he's pushing to cut certain types of spending, but in the aggregate, it's just more and more red ink as far as the eye can see, a tendency that was true of him during his first term, both before and after the pandemic.”

Gillespie added, “In fact, federal spending under Trump increased $1,441 per person before COVID fully opened the spigot. Of the $7.8 trillion in new debt he signed off on in his first term, less than half was related to COVID relief. And by every indication—including his recent budget proposal, which calls for a record-high defense budget of $1.5 trillion—Trump aims to sign off on ever-increasing amounts of spending until his term expires in 2029.”

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