The national debt has reached unprecedented levels, posing a significant threat to the U.S. economy. As the 2024 presidential election approaches, both major candidates, Kamala Harris and Donald Trump, propose policies likely to exacerbate the debt crisis. Their plans focus on tax cuts and government giveaways, largely ignoring the burgeoning national debt. In this article, we explore how their proposals might worsen the national debt crisis and the implications for America’s economic future.

Current State of the National Debt

The national debt recently hit a staggering $35 trillion, a record high that continues to grow. Analysts have warned about unsustainable debt levels for decades, but the U.S. is now in unprecedented territory. Financial markets are beginning to react to the massive amounts of debt the Treasury issues. Some experts believe the debt crisis has already begun. Federal debt held by the public now equals about 100% of the U.S. GDP, which is a significant concern.

Harris and Trump’s Economic Plans

Both Kamala Harris and Donald Trump have proposed policies that could worsen the national debt. Harris aims to let the 2017 tax cuts expire for those earning more than $400,000 while maintaining them for everyone else. Additionally, she proposes boosting tax credits for working parents and lower-income households. On the other hand, Trump wants to maintain all the 2017 tax cuts, reduce the business tax rate further, and eliminate taxes on income from tips and Social Security benefits. Both plans could add trillions to the national debt, with Harris’s plan adding about $5 trillion and Trump’s adding approximately $6 trillion.

The Impact on Social Security and Medicare

Social Security and Medicare are already under significant strain, paying out more than they take in. This imbalance will worsen as more Americans become eligible for these programs. Both Harris and Trump have pledged to protect these benefits without changes, making it impossible to stabilize the national debt. Rising interest payments, due to higher interest rates and the increasing amount of debt, further strain the federal budget.

Fiscal Austerity: A Potential Solution?

Experts suggest that closing the federal revenue-spending gap will require about $10 trillion in savings over the next decade. This could involve budget cuts, new taxes, or a combination of both. Changes to Social Security and Medicare could include cutting benefits for wealthier enrollees and raising the eligibility age. Restructuring Medicare for greater efficiency could also help. These measures could safeguard benefits for lower-income seniors who rely heavily on these programs. However, such changes are politically unpopular and unlikely to be adopted by either candidate.

The Role of the Federal Budget

The federal budget is already underfunded in many areas. Net interest payments are rising sharply, driven by increased debt and higher interest rates. This trend will continue unless significant changes are made. Both presidential candidates propose policies that would increase the national debt, making it even harder to manage the federal budget. Without addressing these issues, the national debt crisis will continue to worsen.

Long-term Economic Implications

If the national debt crisis is not addressed, the U.S. could face severe economic consequences. A debt crisis could trigger a recession and years of fiscal austerity. This scenario would limit the flexibility of future presidents to address economic challenges. The Congressional Budget Office projects that publicly held federal debt will rise from 100% of GDP to 122% within ten years. This projection does not account for potential recessions, which would require fiscal stimulus and further increase the national debt.

Political Challenges and Voter Preferences

Addressing the national debt requires politically challenging decisions. No politician can easily get elected by promising to reform retiree programs or cut popular benefits. Historical attempts to reform Social Security, such as those by President George W. Bush, have faced significant opposition. In today’s climate, mass disinformation and scaremongering make it even harder to propose reasonable solutions without facing backlash.

The Path Forward

To stabilize the national debt, the U.S. needs to sharply reduce annual deficits. This goal requires dramatic changes in fiscal policy. Stabilizing the debt at current levels would place the nation on a more sustainable footing. However, achieving this will require overcoming significant political and economic challenges. It is essential to implement comprehensive reforms to Social Security and Medicare and to adopt more efficient budgeting practices.

Conclusion

As the 2024 presidential election approaches, the national debt remains a critical issue that both candidates largely ignore. Their proposed policies will likely worsen the debt crisis, leading to severe long-term economic consequences. To address this challenge, significant changes in fiscal policy are necessary, including reforms to major entitlement programs and the federal budget. Only by taking decisive action can the U.S. stabilize the national debt and ensure a more secure economic future.

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