New Analysis Suggests National Debt Could Increase Under Harris, Surge Under Trump
A new economic analysis has shed light on the potential trajectories of the U.S. national debt under the leadership of Vice President Kamala Harris and former President Donald Trump, who should take office in 2025. While both leaders' policies are predicted to increase the debt, the analysis suggests that the increase would be more modest under Harris and significantly larger under Trump, due to differing fiscal strategies.
The U.S. national debt is a critical issue as it continues to grow, reaching unprecedented levels in recent years. With the 2024 presidential election on the horizon, the economic policies of potential candidates have come under increased scrutiny, as voters consider their impact on the nation’s long-term financial stability.
Kamala Harris: Moderate Debt Growth Through Strategic Investment
The analysis reveals that under Harris, the national debt is expected to rise, but at a slower pace than it would under Trump. Harris' economic plan focuses on targeted spending in areas such as infrastructure, clean energy, healthcare, and education. These investments are intended to spur long-term economic growth, though they would add to the short-term deficit.
Harris has emphasized that her administration would look for ways to offset new spending with tax increases on corporations and the wealthy. She has also expressed a commitment to reducing tax loopholes and ensuring that the wealthiest Americans contribute a fairer share of the national tax burden. Her proposals aim to reduce the debt-to-GDP ratio over time by stimulating sustainable growth while keeping government borrowing in check.
Donald Trump: Significant Debt Increase Due to Tax Cuts and Military Spending
In contrast, the analysis shows that Trump’s return to office could lead to a dramatic surge in the national debt. His fiscal policies, which include a continuation of tax cuts initiated during his first term, are projected to exacerbate the debt. Trump’s emphasis on expanding military spending, while reducing revenues through tax cuts for businesses and wealthy individuals, would widen the deficit significantly.
Trump has argued that his tax cuts will boost economic growth, which in turn would generate enough revenue to offset the increased borrowing. However, economists remain skeptical, as the deficit under Trump grew substantially during his previous administration, reaching over $3 trillion in 2020 due to both tax cuts and emergency pandemic spending.
Fiscal Challenges Ahead for the U.S.
Both candidates will face significant fiscal challenges, particularly as the nation continues to recover from the economic impacts of the COVID-19 pandemic. The Congressional Budget Office (CBO) has already warned that the national debt, which currently exceeds $33 trillion, will become increasingly difficult to manage without substantial changes to both revenue and spending.
Neither Harris nor Trump have presented a detailed plan for addressing the structural deficits in mandatory spending programs like Social Security and Medicare, which make up the largest share of federal spending. Without reform, these programs are expected to place even greater pressure on the federal budget in the coming years as the population ages.
Expert Reactions: Debt Growth or Economic Investment?
Economic experts are divided over the impacts of increased national debt under both candidates. Some argue that Harris’ focus on investment in critical sectors like clean energy and healthcare will provide long-term economic benefits, making her debt growth more manageable. Others believe that Trump’s emphasis on tax cuts will spur short-term economic growth but will lead to unsustainable debt levels without corresponding revenue increases.
Professor Mark Zandi, Chief Economist at Moody’s Analytics, said, "Harris' approach is more balanced, with investments aimed at improving productivity and infrastructure. Trump's plan, on the other hand, could lead to ballooning deficits due to his commitment to tax cuts without a clear path to increased revenue."
Conversely, some Republican-leaning economists argue that Trump’s tax cuts will reignite economic activity, pointing to the pre-pandemic growth during his first term as evidence. "Trump’s economic policies unleashed growth before, and they can do so again, even if it means a temporary increase in debt," said Stephen Moore, a senior economic advisor to Trump.
What’s Next for U.S. Fiscal Policy?
As the nation heads toward the 2024 election, voters will face a choice between two very different fiscal visions. While both Harris and Trump plan to increase spending, how they choose to balance the federal budget—or not—will be a critical issue for future generations.
For now, the U.S. national debt continues to grow, with both candidates presenting paths that could add to the nation's financial obligations. Whether the country chooses Harris' moderate approach or Trump's more aggressive fiscal strategy, the outcome of the election will likely have a profound impact on the U.S. economy in the coming years.