If we had a dollar for every time the debt ceiling was raised… oh wait, that’s the problem. On Monday, the US national debt soared past $35T, up from $34T in January. This rapid increase is fueled by the escalating costs of rising interest rates and federal spending, making it even harder to manage the nation’s debt problem.

• The Congressional Budget Office (CBO) estimates that the public portion of the debt will equal 99% of the Gross Domestic Product (GDP) this year.
• Some federal programs, such as the Employee Retention Tax Credit and Inflation Reduction Act, have added to the debt, as companies have paid less in taxes.

Red ink remedy: This year, the government is on track to record a $1.9T deficit, the third-largest in US history. The deficit could lighten if interest rates drop later this year, making it cheaper to service the debt. However, there are differing opinions on how to tackle the debt issue. Democrats propose reducing the deficit by $3T over ten years by increasing taxes on the wealthy and large corporations. Conversely, Republicans advocate for spending cuts, particularly in federal programs, to solve the debt crisis. If the current trend continues, the CBO projects the national debt will reach $56T by 2034.