America's debt crisis is no longer a distant concern; it's an immediate threat with immediate consequences. Some politicians—perhaps realizing that it's become more difficult to ignore the problem and avoid repercussions—are turning to executive action. This includes the Trump administration's embrace of Elon Musk's increasingly active Department of Government Efficiency (DOGE).
It's an unorthodox approach that may make some important progress reducing fraud and improving efficiency. But it isn't foolproof or without tremendous risks.
Federal debt stands at approximately 100 percent of gross domestic product (GDP), with annual deficits projected to exceed $1.8 trillion and heading to $2.5 trillion in 2035. Interest costs on the debt are higher than defense spending and growing. Left unchecked, the debt could be nearly double the size of the economy by mid-century. That's also based on rosy assumptions like a growing economy and relatively lower inflation and interest rates.
