US debt hasn't been this high since World War II. That's ok...for now

  • On Friday, the US Treasury reported that for fiscal year 2020, which ended September 30, the US deficit hit $3.13 trillion (which is an estimated 15.2% of GDP) thanks to the chasm between what the country spent ($6.55 trillion) and what it took in ($3.42 trillion) for the year.
  • Having topped $21 trillion, the country's total debt owed to investors -- which essentially is the sum of annual deficits that have accrued over the years -- is now estimated to have outpaced the size of the economy, coming in at nearly 102% of GDP, according to calculations from the Committee for a Responsible Federal Budget.
  • Given the risks of future disruptions to the economy, a debt load that already is outpacing economic growth puts the country at greater risk of a fiscal crisis, which in turn would require sharp cuts to the services and benefits on which Americans rely.

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