Elon Musk, the world’s richest person and now heading the newly created Department of Government Efficiency (D.O.G.E), shared his views on the increasing US national debt. In his attempt to create awareness around the debt, he received some backlash suggesting that Trump’s first term as the US President added around $8 trillion to the tally.
The US government’s interest payments have reportedly surged to their highest level since 1990. The Treasury spending accounted for $882 billion in net interest in the fiscal year ending in September. The interest rate cost has been added to now stand at $27.7 trillion, isn’t it alarming?
Musk sounds alarm on national debt
Musk in an X post wrote that a huge percentage of the people do not know that there is a such thing as a national debt. He tried to inform that most of the people didn’t even know how big this issue might be. He added that the country’s interest payments now exceed what they spend on the military.
The D.O.G.E head highlighted that only a small percentage of the population understands that government overspending causes inflation. He even shared a clip where Marc Andreessen states that “the Federal Government today pays more in interest on the debt than we do in the budget for the Department of Defense.”
Andreessen in the clip further mentioned that the US pays $1.2 billion a year in just interest on debt while the total government spending is about $7 trillion. However, the total debt is around $35 trillion and it adds another $1 trillion of debt every 100 days.
🚨”The Federal Government today pays more in interest on the debt than we do in budget for the Department of Defense. We pay $1.2B a year in JUST interest on debt. Total government spending is about $7T. Interest payments are $1.2T. DOD is $800B a year. Total debt is $35T and it… pic.twitter.com/uegWgvYyvx
— Autism Capital 🧩 (@AutismCapital) November 27, 2024
One user reminded him of the debt Trump added during his term. He called out that the President-elect had added $8 trillion to the debt during his first term and the taxpayers are still paying interest on that. Even after this, Trump is looking to add more tax cuts allegedly for the rich, and that too without being able to avoid adding more to the debt.
Can D.O.G.E make the cuts?
The US’s interest payments saw a surge reportedly due to the soaring budget deficits which was driven by the rising spending on Social Security and Medicare, COVID-related expenditures. However, it saw revenue constraints from the 2017 tax cuts. Eventually, a spike in interest rates has also added pressure on influencing the financial markets.
Vivek Ramaswamy and Elon Musk pushed ahead with their newly created D.O.G.E to cut federal spending by $500 billion annually. They have even outlined plans to focus on trimming unauthorized expenditures and those misallocated beyond Congressional intent. Meanwhile, their bold claims to cut the spending have already faced skepticism.
Musk has previously suggested a higher target of $2 trillion in savings but experts consider this as ambitious. This comes after looking at the bulk of the US budget tied up in mandatory spending on Social Security, Medicare, and defense.
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