As of May 2021, the national debt has climbed to over $28.24 trillion, approximately $84,803 per citizen or $225,309 per U.S. taxpayer. According to USdebtclock.org, the federal debt-to-GDP (gross domestic product) ratio is now 127.73%, compared to 52.95% in 1960, 34.57% in 1980 and 58.12% in 2000. The previous high was 106.1% in 1946.
The national debt is a result of yearly budget deficits. In fact, since 1970, the federal government only had a budget surplus four years: 1998, 1999, 2000 and 2001. Also contributing to the yearly deficit is an incremental increase in yearly mandatory spending and interest on the debt. Interest on the debt is approaching $400 billion at current rates.
The debt is owed to both domestic and international creditors. About 22% is held by the federal government and includes money borrowed from other areas such as Social Security and Medicare trust funds and various pension and retirement funds. The remaining 78% is held by foreign governments, banks, investors and mutual funds, the Federal Reserve and others.
Later this year Congress will again be asked to raise the debt ceiling, or to increase the amount the U.S. can borrow. Congress is also debating infrastructure spending and raising revenue through tax increases. Next year we will start rewriting the next farm bill – which typically costs over $400 billion every five years. Addressing the escalating national debt will take leaders willing to make tough or unpopular decisions.
Current Farm Bureau policy includes program areas with costs, including farm bill programing; improvements to roads, bridges and broadband; research investments and ad hoc disaster assistance. It also includes tax policies that help farmers and supports a balanced federal budget.
Thoughts to Consider
- What should Congress do to address the national debt?
- What is Farm Bureau’s role in the national debt discussion?
- How can we help ensure farmers don’t disproportionately pay more than their fair share of the national debt?
- Can Farm Bureau continue to advocate for programs and policies with a cost without supporting tax increases?