Trump's Legacy: The Exploding U.S. National Debt

The International Financial Association has issued a stark warning: during President Trump's term, the U.S. national debt is set to "explode in growth." This article delves into the factors contributing to this alarming trend and its potential implications for the American economy.

During Trump's presidency, the national debt surged by nearly $8 trillion, reaching a staggering $28.4 trillion by the end of his term. This rapid increase can be attributed to a combination of factors, including tax cuts, increased spending, and the economic fallout from the COVID-19 pandemic.

The Tax Cuts and Jobs Act of 2017, signed into law by President Trump, significantly reduced federal revenue. The nonpartisan Congressional Budget Office estimated that the tax cut would increase deficits by about $1.9 trillion over 11 years. This reduction in revenue, combined with increased spending, led to a surge in the national debt during Trump's term.

Discretionary spending increases in 2018 and 2019 also played a significant role in the growth of the national debt. According to the Committee for a Responsible Federal Budget, these increases added $2.1 trillion to the debt over a 10-year period. This spending, primarily on defense and non-defense discretionary programs, accounted for about 25% of the total $8.4 trillion debt increase during Trump's term.

The CARES Act and other COVID relief measures significantly contributed to the debt increase under Trump. The CARES Act alone added $1.9 trillion to the debt over a ten-year period, with the total debt impact of COVID relief laws and executive orders reaching $3.6 trillion. This is due to increased spending on unemployment benefits, direct payments to individuals, and support for businesses, as well as the expansion of safety net programs.



The economic downturn caused by the pandemic also significantly impacted government revenues and spending. According to the Congressional Budget Office, federal revenues fell by $444 billion in 2020, primarily due to lower income and payroll taxes. Simultaneously, spending increased by $1.9 trillion, driven by emergency relief and healthcare measures. This led to a $3.1 trillion deficit, the largest in U.S. history.

The rapid growth of the national debt under Trump has raised concerns about the long-term sustainability of the U.S. economy. High levels of debt can lead to increased borrowing costs, reduced economic growth, and potential fiscal crises. As the U.S. continues to grapple with the aftermath of the COVID-19 pandemic and the challenges of an increasingly interconnected global economy, addressing the national debt will be a critical priority for policymakers.

In conclusion, the International Financial Association's warning about the exploding U.S. national debt under Trump is a stark reminder of the fiscal challenges facing the American economy. Addressing this issue will require a balanced approach that combines responsible fiscal policy with economic growth and job creation. As the U.S. looks to the future, it is essential to learn from the past and take steps to ensure the long-term sustainability of the nation's fiscal health.