US Economy: America′s massive debt load a no-show on the campaign trail

Public health care, education and gun laws are the hottest issues in the US election campaign. But neither Democratic nor Republican hopefuls are eager to discuss the burning question of the country's financial future.

US President Donald Trump is not exactly known for being humble when it comes to describing his leadership credentials. Already in the run-up to the 2016 elections that swept him to power, the then Republican candidate pledged to "eliminate" the $19 trillion (€17.4 trillion) of US debts within a period of eight years.

Now, almost four years later, a look at Trump's debt reduction record is sobering by all counts. Instead of lowering America's debt load, figures recently released by the Congressional Budget Office (CBO) show the upward trajectory of the country's financial problems.

Since assuming office, the Trump administration has added a net total of $2.5 trillion in fresh debt, with the US budget deficit in the first four months of 2020 alone rising by 25%. This means that Trump has already spent close to 40% of the entire deficit last year.

The primary reason for the budget gap is Trump's 2017 package of tax cuts, which he once described as a "great Christmas gift to the middle class."

With overall US debts spiraling to $22.5 trillion, the CBO now has warned that such a high and rising debt load could pose a severe financial risk to the United States. The nonpartisan agency has estimated that state spending could surpass revenue by $1 trillion in 2020.

Surprisingly though, neither the Democrats nor the Republicans have made this an issue in their campaigns for the US presidency.

The US "Trump dollar" is totally overvalued

Trump also didn't waste a word on the debt problem in his latest State of the Union address and failed to chart out a clear reduction strategy. All he came up with was the lofty promise of trimming state expenditure by $4.4 trillion over the next decade. At the same time, however, Trump plans to increase spending for the military, the space industry and for the wall he wants to building along the border with Mexico.

Among the Democratic hopefuls, too, the US's dire financial straits seem to be on the backburner of their campaigns. In their first televised debate, all of the candidates conspicuously ignored the debt issue, with the ugly "deficit" word not being mentioned once in the 4-hour road show. Public debts were only once briefly touched upon.

Political observers believe the Democrats have many reasons to keep America's miserable finances flying under the radar during the presidential primaries.

"The average American has no interest in US debt at all," says G. William Hoagland, senior vice president at the Washington-based think tank Bipartisan Policy Center. He told DW that the booming US economy of the past years, including low interest rates and unemployment, had Americans feeling less worried about the mounting deficit.

"So why should Democrats address such a sensitive topic and stick their neck out for it," he says, and notes that most of the voters are satisfied overall with their current financial situation.

Read more: America′s massive debt load a no-show on the campaign trail | Business| Economy and finance news from a German perspective | DW | 25.02.2020