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WASHINGTON — The federal government’s gross national debt has surpassed $34 trillion, a record high that foreshadows the coming political and economic challenges to improve America’s balance sheet in the coming years. 

The U.S. Treasury Department issued a report Tuesday logging U.S. finances, which have become a source of tension in a politically divided Washington that could possibly see parts of the government shut down without an annual budget in place. 

Republican lawmakers and the White House agreed last June to temporarily lift the nation’s debt limit, staving off the risk of what would be a historic default. That agreement lasts until January 2025. Here are some answers to questions about the new record national debt. 

How did the national debt hit $34 trillion?  

The national debt eclipsed $34 trillion several years sooner than pre-pandemic projections. The Congressional Budget Office’s January 2020 projections had gross federal debt eclipsing $34 trillion in fiscal year 2029. 

But the debt grew faster than expected because of a multiyear pandemic starting in 2020 that shut down much of the U.S. economy. The government borrowed heavily under then-President Donald Trump and current President Joe Biden to stabilize the economy and support a recovery. But the rebound came with a surge of inflation that pushed up interest rates and made it more expensive for the government to service its debts. 

“So far, Washington has been spending money as if we had unlimited resources,” said Sung Won Sohn, an economics professor at Loyola Marymount University. “But the bottom line is, there is no free lunch,” he said. “And I think the outlook is pretty grim.” 

The gross debt includes money that the government owes itself, so most policymakers rely on the total debt held by the public in assessing the government’s finances. This lower figure — $26.9 trillion — is roughly equal in size to the U.S. gross domestic product. 

Last June, the Congressional Budget Office estimated in its 30-year outlook that publicly held debt will be equal to a record 181% of American economic activity by 2053. 

What is the impact to the economy?  

The national debt does not appear to be a weight on the U.S. economy right now, as investors are willing to lend the federal government money. This lending allows the government to keep spending on programs without having to raise taxes. 

But the debt’s path in the decades to come might put at risk national security and major programs, including Social Security and Medicare, which have become the most prominent drivers of forecasted government spending over the next few decades. Government dysfunction, such as another debt limit showdown, could also be a financial risk if investors worry about lawmakers’ willingness to repay the U.S. debt. 

Foreign buyers of U.S. debt — like China, Japan, South Korea and European nations — have already cut down on their holdings of Treasury notes. 

A Peterson Foundation analysis states that foreign holdings of U.S. debt peaked at 49% in 2011 but dropped to 30% by the end of 2022. 

“Looking ahead, debt will continue to skyrocket as the Treasury expects to borrow nearly $1 trillion more by the end of March,” said Peterson Foundation CEO Michael Peterson. “Adding trillion after trillion in debt, year after year, should be a flashing red warning sign to any policymaker who cares about the future of our country. 

How could it affect me?  

The debt equates to about $100,000 per person in the U.S. That sounds like a lot, but the sum so far has not appeared to threaten U.S. economic growth. 

Instead, the risk is long term if the debt keeps rising to uncharted levels. Sohn said a higher debt load could put upward pressure on inflation and cause interest rates to remain elevated, which could also increase the cost of repaying the national debt. 

And as the debt challenge evolves over time, choices may become more severe as the costs of Social Security, Medicare and Medicaid increasingly outstrip tax revenues. 

When it could turn into a more dire situation is anyone’s guess, says Shai Akabas, director of economic policy at the Bipartisan Policy Center. “But if and when that happens, it could mean very significant consequences that occur very quickly. 

“It could mean spikes in interest rates. It could mean a recession that leads to lots more unemployment. It could lead to another bout of inflation or weird goings-on with consumer prices — several of which are things that we’ve experienced just in the past few years,” he said. 

How do Republicans and Democrats differ?  

Both Democrats and Republicans have called for debt reduction, but they disagree on the appropriate means of doing so. 

The Biden administration has been pushing for tax hikes on the wealthy and corporations to reduce budget deficits, in addition to funding its domestic agenda. Biden also increased the budget for the IRS so that it can collect unpaid taxes and possibly reduce the debt by hundreds of billions of dollars over 10 years. 

Republican lawmakers have called for large cuts to non-defense government programs and the repeal of clean energy tax credits and spending passed in the Inflation Reduction Act. But Republicans also want to trim Biden’s IRS funding and cut taxes further, both of which could cause the debt to worsen. 

A Treasury Department representative did not respond to a request for comment. 

“There is growing concern among investors and rating agencies that the trajectory we’re on is unsustainable — when that turns into a more dire situation is anyone’s guess,” Akabas said. 
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WASHINGTON — Harvard President Claudine Gay said she would resign from her position on Tuesday, after her first months in the role were rocked by her congressional testimony about antisemitism on campus and allegations of plagiarism.

Gay had faced pressure to resign from Harvard’s Jewish community and some members of Congress over her comments at the Dec. 5 congressional hearing, and she has also faced several allegations of plagiarism for her academic work in recent months.  

In a letter to the Harvard community, Gay said her decision to step down had been “difficult beyond words.”

“After consultation with members of the Corporation, it has become clear that it is in the best interests of Harvard for me to resign so that our community can navigate this moment of extraordinary challenge with a focus on the institution rather than any individual.”

The Harvard Corporation, the university’s 11-member governing body, said in an email to the community that its members had accepted Gay’s resignation “with sorrow.”

Gay, former University of Pennsylvania President Liz Magill and Massachusetts Institute of Technology President Sally Kornbluth testified before a U.S. House of Representatives committee on Dec. 5 about a rise in antisemitism on college campuses following the outbreak of the Israel-Hamas war in October.

The trio declined to give a definitive “yes” or “no” answer to Republican Representative Elise Stefanik’s question as to whether calling for the genocide of Jews would violate their schools’ codes of conduct regarding bullying and harassment, saying they had to balance it against free speech protections.

More than 70 U.S. lawmakers signed a letter demanding that the governing boards of the three universities remove the presidents, citing dissatisfaction with their testimony.

Magill resigned after receiving backlash for her comments.

“Harvard knows that this long overdue forced resignation of the antisemitic plagiarist president is just the beginning of what will be the greatest scandal of any college or university in history,” Representative Stefanik said in a statement on Tuesday.

Despite the controversy ensnaring Gay, the Harvard Corporation last month reaffirmed its confidence that she could lead the school through a period of high tension over the war in the Middle East. It also said an independent review of Gay’s academic work found she had not committed research misconduct. She has submitted several corrections for citation errors in recent weeks.

Gay, who became the university’s first Black president six months ago, and the members of the Harvard Corporation said in their letters to the community on Tuesday that she had been subject to racist attacks.  

Some of Gay’s critics, including billionaire hedge fund manager Bill Ackman, have argued that she was chosen for the role as part of the school’s effort to promote diversity rather than for her qualifications.

Ackman could not immediately be reached for comment on Tuesday. He reposted the Harvard Crimson’s story about Gay’s resignation on social media platform X, formerly known as Twitter.

“It has been distressing to have doubt cast on my commitments to confronting hate and to upholding scholarly rigor – two bedrock values that are fundamental to who I am – and frightening to be subjected to personal attacks and threats fueled by racial animus,” Gay said in her statement.

The Harvard Corporation wrote that she had been subjected to “deeply personal and sustained attacks” that included “racist vitriol directed at her through disgraceful emails and phone calls.”
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NEW YORK — Access to a busy terminal at New York’s John F. Kennedy International Airport was restricted Monday as pro-Palestinian protesters converged on the airport for the second time in a week.

Videos posted online show heavy traffic and a slow-moving line of cars, some flying Palestinian flags and featuring text on the windows such as “Stop the genocide.” Police directed a line of cars around a checkpoint. Protesters also had planned to arrive at the airport in Queens, New York, by public transportation.

The New Year’s Day action was the latest in a series of protests around the nation calling for a cease-fire since the Israel-Hamas war began on Oct. 7. Last Wednesday, activists brought traffic to a standstill on an expressway leading up to JFK for about 20 minutes. Protesters shut down a major thoroughfare leading to the Los Angeles International Airport on the same day.

Entry into JFK’s Terminal 4 was temporarily restricted Monday afternoon to ticketed passengers, employees and people with what authorities consider a valid reason to be there, such as passenger pickups, according to the Port Authority of New York and New Jersey, which operates the region’s airports. 

Similarly, AirTrain access was temporarily restricted to ticketed passengers and employees.

“The Port Authority, in coordination with our local, state, and federal partners, has deployed safety and security measures to help ensure an uninterrupted travel experience at JFK,” port authority spokesperson Seth Stein said in an email.

The Port Authority of New York and New Jersey didn’t report any arrests.

City officials had warned people flying out of JFK on Monday, a busy travel day, to get to the airport early because of the protests.

Police said the caravan of cars was later headed to protest outside LaGuardia Airport, which is also in Queens. 

 
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pasadena, california — Floral floats, marching bands and equestrian units took to the streets under a sunny California sky as the 135th Rose Parade drew hundreds of thousands of spectators on New Year’s Day.

The Pasadena tradition on Monday featured Broadway legend Audra McDonald as grand marshal and the theme “Celebrating a World of Music: The Universal Language.”

After recent rains and gray skies, there was plenty of sun for the 8 a.m. start of the spectacle with a military flyover of a B-2 stealth bomber.

Among the fanciful floats was Kaiser Permanente’s colorful “Symphony of You,” which featured 8,000 roses and received the President Award for most outstanding use and presentation of flowers.

The top prize, the 2024 Sweepstakes Trophy, went to the San Diego Zoo for the 16.8-meter float “It All Started With a Roar,” depicting its mascot Rex the Lion and celebrating wildlife conservation.

Huge crowds lined the 8.8-kilometer parade route. Many camped out on sidewalks overnight, staking out their spots in the afternoon on New Year’s Eve.

The parade was briefly interrupted by about 50 pro-Palestinian protesters carrying a banner demanding a cease-fire in the war between Israel and Hamas. They blocked the route before peacefully dispersing under police orders, said city spokesperson Lisa Derderian.

McDonald was set to toss the coin before the 110th Rose Bowl college football game between Alabama and Michigan.
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WASHINGTON — After months of extra duty at sea providing protection for Israel, the USS Gerald R. Ford aircraft carrier strike group will be heading home, the Navy announced on Monday. 

The Ford and its accompanying warships will be replaced by the amphibious assault ship the USS Bataan and its accompanying warships, the USS Mesa Verde and the USS Carter Hall. The three vessels had been in the Red Sea and have been transiting toward the Eastern Mediterranean over the last few days. 

The Ford will sail for home “in the coming days,” the U.S. 6th Fleet, the European-based U.S. naval command that’s responsible for ships sailing in the Mediterranean, said in a statement. 

The Ford was sent to the Eastern Mediterranean to be within striking distance of Israel since the day after Hamas’ October 7 attacks. The carrier stayed in the Eastern Mediterranean while its accompanying warships had sailed into the Red Sea, where they repeatedly intercepted incoming ballistic missiles and attack drones fired from Houthi-controlled Yemen. Defense Secretary Lloyd Austin visited the Ford last month. 

Since it was extended in the Eastern Mediterranean, the Ford and the USS Dwight D. Eisenhower aircraft carrier have been part of a two-carrier presence bracketing the Israel-Hamas war, underscoring U.S. concerns that the conflict will widen. The Eisenhower has recently patrolled near the Gulf of Aden, at the mouth of the Red Sea waterway, where so many commercial vessels have come under attack in recent weeks. 

On Sunday, helicopters from the Eisenhower and its destroyer the USS Gravely responded to a distress call from the container ship Maersk Hangzhou, which was under attack by four Iranian-backed Houthi small boats. As the helicopters responded, the boats fired at them with crew-served weapons and small arms and the helicopters returned fire, sinking three of the four boats and killing their crews, the U.S. Central Command said. 

The incessant attacks on the commercial ships have led some companies to suspend transits through the narrow Bab el-Mandeb Strait, which connects the Gulf of Aden to the southern Red Sea and then the Suez Canal. 

The Bataan’s accompanying warship, the Mesa Verde, is a transport dock ship carrying approximately 2,000 Marines from the 26th Marine Expeditionary Unit. Those Marines provide “forces capable of supporting a wide range of missions,” the U.S. 6th Fleet said. 

The Carter Hall is a dock landing ship, which carries amphibious landing craft and their crews. Both vessels and the Bataan can support rotary aircraft; the Bataan can also carry and support Marine Corps’ F-35 vertical takeoff fighter aircraft. 
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WASHINGTON — In this time of war overseas, more Americans think foreign policy should be a top focus for the U.S. government in 2024, with a new poll showing international concerns and immigration rising in importance with the public.

About 4 in 10 U.S. adults named foreign policy topics in an open-ended question that asked people to share up to five issues for the government to work on in the next year, according to a December poll from The Associated Press-NORC Center for Public Affairs Research.

That’s about twice as many who mentioned the topic in the AP-NORC poll conducted last year.

Long-standing economic worries still overshadow other issues. But the new poll’s findings point to increased concern about U.S. involvement overseas — 20% voiced that sentiment in the poll, versus 5% a year ago.

It also shows that the Israeli-Hamas war is feeding public anxiety. The conflict was mentioned by 5%, while almost no one cited it a year ago. The issue has dominated geopolitics since Israel declared war on Hamas in Gaza after that group’s October 7 attack on Israeli soil.

Four percent of U.S. adults mentioned the conflict between Russia and Ukraine as something for their government to focus on this year. That’s similar to the 6% who mentioned it at the end of 2022.

Foreign policy has gained importance among respondents from both parties. Some 46% of Republicans named it, up from 23% last year. And 34% of Democrats list foreign policy as a focal point, compared with 16% a year ago.

Warren E. Capito, a Republican from Gordonsville, Virginia, worries China could soon invade Taiwan, creating a third major potential source of global conflict for the U.S.

 “They would love to have us split three ways,” he said of China, and “we’re already spread so thin.”

Immigration is also a rising bipartisan concern.

Overall, the poll found that concerns about immigration climbed to 35% from 27% last year. Most Republicans, 55%, say the government needs to focus on immigration in 2024, while 22% of Democrats listed immigration as a priority. That’s up from 45% and 14%, respectively, compared with December 2022.

Janet Brewer has lived all her life in San Diego, across from Tijuana, Mexico, and said the situation on the border has deteriorated in recent years.

“It’s a disaster,” said Brewer, 69, who works part time after running a secretarial and legal and medical transcription small business. “It’s crazy.”

The politics of foreign military aid and immigration policy are entangled, with President Joe Biden’s administration promoting a $110 billion package that includes aid for Ukraine and Israel that remains stalled in Congress while Republicans push for a deal allowing major changes in immigration policy and stricter enforcement along the U.S.-Mexico border.

Brewer said she wouldn’t vote for Biden or a Republican for president in 2024, and may opt for independent Robert F. Kennedy Jr. But she also questions whether a change in the White House would necessarily improve immigration policy.

As for foreign aid, she said, “I know that we need to help. But come on. We’ve done enough.”

Even as immigration and foreign policy rose as concerns, those issues were no match for worries about the economy. Inflation has fallen, unemployment is low, and the U.S. has repeatedly defied predictions of a recession — yet this poll adds to a string of them showing a gloomy outlook on the economy.

Some 76% of U.S. adults said this time that they want the government to work on issues related to the economy in 2024, nearly the same as the 75% who said so at this point in 2022.

About 85% of Republicans and 65% of Democrats name the economy as a top issue. But Republicans are more likely than Democrats to want the government to address some specific economic issues: on inflation 41% vs. 22% and on government spending or debt, 22% vs. 7%.

Meanwhile, 3 in 10 U.S. adults listed inflation as an issue that the government should focus on, unchanged from 2022.

The economy is a top issue mentioned by 18- to 29-year-olds (84%), followed by inflation specifically (39%), personal finance issues (38%) and foreign policy (34%). In the same age bracket, 32% mentioned education or school loans as something for the government to address in 2024. That’s despite the Biden administration trying new, more modest efforts to cancel debts after the Supreme Court struck down its larger original push.

Among those 30 and older, only 19% mention student loans. But Travis Brown, a 32-year-old forklift operator in Las Vegas, noted that he’s back to getting calls seeking payment of his student loans.

“Right now, with the economy, wages are not matching,” Brown said. “Blue collar’s going away, and I don’t see how that’s going to boost an economy. An economy thrives off the working class. Not off the rich.”

Brown also suggested that the U.S. is too focused on shipping aid to its overseas allies.

“I care about others, I do,” he said. “But when you sit here and say, ‘I just sent $50 million over to Israel,’ and then I go outside, and I see half a neighborhood run-down … you’ve got to take care of home.”

One possible sign that larger sentiments on the economy could be improving slightly is that overall mentions of personal financial issues declined some, with 30% mentioning them now compared with 37% last year. Drops occurred for Democrats, 27% vs. 33%, and among Republicans, falling to 30% compared with 37% in 2022.

One-quarter of U.S. adults say 2024 will be a better year than 2023 for them personally, and 24% expect it will be a worse year. Some 37% of Republicans expect it’ll be a worse year for them, compared with 20% of independents and 13% of Democrats.

Just 5% of U.S. adults are “extremely” or “very” confident that the federal government can make progress on the important problems and issues facing the country in 2024, with 7% of Democrats and 11% of independents being optimistic, compared with 1% of Republicans.

Brown is a Democrat but said he was disillusioned enough to perhaps sit out the presidential election — especially if it proves to be a 2020 rematch between Biden and former President Donald Trump, who has built a commanding early lead in the 2024 Republican primary.

“I don’t think I will participate, and maybe that’s bad,” Brown said. “But it’s like, you’re losing faith.”
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