Washington Post: America’s debt reaches $36 trillion, and the war in Iraq is a major reason.
The United States’ debt is heading toward its highest levels since World War II, reaching $36 trillion, a figure that is expected to continue rising, as the U.S. government spends approximately $2 trillion more than its annual revenues.
This chronic financial deficit is one of the most prominent indicators of the country’s financial deterioration, a deterioration caused by eight major events and decisions, most notably the Iraq War, according to a report by the Washington Post, translated by Shafaq News Agency.
According to the report, the US Treasury is forced to borrow annually to cover this huge gap between revenues and expenditures, meaning that the national debt will continue to rise and may soon exceed its peak as a percentage of GDP reached at the end of World War II unless fundamental reforms are undertaken.
The report added that the bulk of this debt has accumulated over the past two decades, noting that in 2001, the state was recording a financial surplus as a result of tax collection, with a total that exceeded spending on government services.
However, the report explains that “since that time, four US presidents, ten terms of Congress, and two major wars, including the invasion of Iraq, have contributed to the accumulation of this debt, along with domestic political decisions, the rising costs of Social Security and health care programs, repeated tax cuts, bipartisan spending agreements, and massive expenditures allocated to deal with the COVID-19 pandemic.”
The report lists eight key moments that contributed to the United States’ arrival at this point, most notably its wars in Iraq and Afghanistan. Following the September 11, 2001, attacks, the United States launched its invasion of Iraq, with a national debt of $6.5 trillion at the time. It continued to wage wars in the Middle East for nearly two decades, leading to significant increases in military spending and veterans’ expenses.
The report is based on a Harvard University study, which indicated that “the wars in Iraq and Afghanistan cost the United States between $4 and $6 trillion.”
The report also explained that US President George W. Bush signed the first two major tax cuts into law, reducing tax rates on income, capital gains, and stock dividends.
The Congressional Budget Office estimated in 2012 that these cuts added about $1.5 trillion to the national debt, which was then at $5.7 trillion.
The report also highlighted Medicare Part D, a major expansion of health coverage for seniors to include prescription drugs, which was passed when the debt stood at $8.4 trillion.
In 2008, with debt reaching $10.1 trillion, the financial market crisis deepened the Great Recession, the worst economic downturn since the Great Depression. According to economist Brian Riedel, the Bush and Obama administrations together enacted emergency measures worth nearly $2 trillion to address the effects of the crisis.
In 2013, when the debt reached $16.8 trillion, the Obama administration extended tax breaks for all but the wealthy, while Republicans agreed to extend some economic stimulus measures, as part of a deal estimated to cost a total of $4 trillion.
During President Donald Trump’s first term, a comprehensive tax cut bill was passed, focusing on reducing the corporate tax rate from 35% to 21%, and also included tax cuts for the majority of individual taxpayers.
The cost of this measure was estimated at approximately $1.5 trillion, while its cumulative impact was estimated at approximately $2.9 trillion, at a time when the public debt stood at $20.5 trillion.
In 2020, the United States faced the COVID-19 pandemic, with Trump signing the first and largest of three relief packages passed by Congress.
The first bipartisan package was worth approximately $3.4 trillion, followed by a second package worth $900 billion.
In 2021, Democrats, led by President Joe Biden, passed a third package worth $1.9 trillion, at a time when the debt had reached $27.7 trillion.
The report continues by noting that Biden succeeded in 2022 in pushing Congress to approve increased spending in the areas of health care for veterans, infrastructure, and a number of government agencies, which contributed to the debt rising to $30.9 trillion.
The report concluded by noting that Republicans in Congress and the Trump administration are moving this year to implement a plan that would increase the federal budget deficit by more than $2 trillion over the next ten years, and possibly by more than $5 trillion, unless comprehensive reform measures are taken to rein in the US public debt.
Shafaq.com