US National Debt Surges Past $38 Trillion Amid Government Shutdown

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00:00U.S. national debt surges past $38 trillion amid government shutdown.

00:05As the government shutdown continues, U.S. national debt has surpassed $38 trillion for the first time,

00:12marking the fastest accumulation of $1 trillion outside the COVID-19 pandemic.

00:18Just two months ago, it was $37 trillion.

00:21This is the fastest pace of debt growth we've seen in decades, said Kent Smetters,

00:26director of the Penn Wharton budget model at the University of Pennsylvania and a former Treasury official.

00:32He warned that growing debt leads to higher inflation, eroding purchasing power.

00:37Government Accountability Office warns it could raise costs for loans, lower wages, and inflate prices.

00:43I think a lot of people want to know that their kids and grandkids are going to be in good, decent shape in the future,

00:48that they will be able to afford a house, Smetters told the Associated Press.

00:52That additional inflation compounds and erodes consumers' purchasing power, he added.

00:59Despite the ballooning debt, the Trump administration insists its fiscal policies are slowing government spending and cutting the deficit.

01:07During his first eight months in office, President Donald Trump has reduced the deficit by $350 billion,

01:14compared to the same period in 2024, by cutting spending and boosting revenue, White House spokesman Kush Desai said in a statement.

01:21The federal deficit from April to September totaled $468 billion, the lowest since 2019.

01:30Still, fiscal watchdogs remain deeply concerned.

01:34Michael Peterson of the Peter G. Peterson Foundation warns that the $38 trillion debt is evidence of neglected fiscal duties.

01:41Interest costs, growing rapidly, will reach $14 trillion in the next decade, he observed, impacting essential investments and citizens' welfare.

01:51According to the Joint Economic Committee, the national debt has grown by roughly $69,713.82 per second over the past year.

02:01It reached $34 trillion in January 2024, now $38 trillion, continuing unabated.