来源：《China Daily》，2024年8月13日
作者：柯静，上海社会科学院国际问题研究所副研究员
Data showing the national debt of the United States at a record high of $35 trillion and an unemployment rate that is surging have sparked worries about the health of the US economy. Experts said the large federal debt reflects inadequate policy responses and failure of governance, and carries wide ramifications for the world.
The gross federal debt of the US surpassed $35 trillion at the end of July, Treasury Department data showed. This translates into a per capita debt of $104,000, according to the Peter G. Peterson Foundation, a nonpartisan organization that focuses on addressing long-term fiscal challenges in the US.
Chen Weidong, general manager of the Research Institute of the Bank of China, said the large US federal debt is the result of the continued accumulation of fiscal imbalances. Government spending has been rising rapidly to support social security and the economy, he said, noting that military spending has climbed, particularly after the Russia-Ukraine conflict.
The gross national debt grew rapidly from $20 trillion in September 2017 to $30 trillion in early 2022 to $34 trillion in late 2023.
According to Tian Lihui, dean of the Institute of Finance and Development at Nankai University, during the pandemic, the US government adopted large-scale fiscal stimulus measures and purchased securities from the market to boost liquidity, leading to soaring federal debt.
In addition, US debts are globally deemed as a safe haven, which allows the US government to borrow more money at a lower cost, Tian said.
The high debt level can cause significant problems if economic conditions worsen, Ke Jing, associate research professor at the Shanghai Academy of Social Sciences' Institute of International Relations, said.
The record debt figures were revealed as the US Bureau of Labor Statistics said in early August that unemployment rate had risen to 4.3 percent, the highest since October 2021, beating the projection of 4.1 percent. The nonfarm payrolls — a key employment index — increased only by 114,000 in July, a slowing from 179,000 jobs added in June.
Financial news site MarketWatch reported that a closely tracked recession indicator, the Sahm rule, had been triggered. The rule says a recession is imminent when the unemployment rate, based on a three-month average, is half a percentage point above its lowest point over the previous 12 months.
Economists from the Goldman Sachs Group have hiked the probability of a US recession in the next year to 25 percent from 15 percent, Bloomberg reported.
Worries about an imminent recession in the US have led to stock price fluctuations in major stock markets around the world.
The situation has prompted further speculations on whether the Federal Reserve will cut interest rates in September.
The Fed kept its benchmark policy interest rate unchanged in July at a two-decade high of 5.25 to 5.50 percent. The budget office predicts annual interest costs will rise to $1.7 trillion in 2034 from $892 billion this year, the New York Times reported.
The interest spending is too high for the government to sustain, Ke from the Shanghai Academy of Social Sciences' Institute of International Relations said.
With high interest rates, the US national debt will continue to soar. This would increase borrowing costs for businesses, discouraging investment and consumption, Ke added.
Chen of the Research Institute of the Bank of China said the Fed is likely to initiate a rate cut in September and perhaps another in the fourth quarter to better balance inflation and economic growth.
The consumer price index rose 3 percent in June from a year earlier, according to the US Labor Department, below the 3.1 percent market expectation.
There is not necessarily a need to cut interest rates at the moment, but the Fed might lower its rate to influence the financial market and balance politics, Tian of the Institute of Finance and Development at Nankai University said.
Rating agency Moody's in November lowered its outlook on the US credit rating to negative from stable, citing large fiscal deficits and a decline in debt affordability, several months after Fitch downgraded US credit rating to AA+ from AAA.
There is a contradiction between the escalating US debt and its role as a global safe asset, Chen said. On one hand, to strengthen its reserve asset status, the US must continually increase fiscal deficits to produce these safe assets. On the other hand, expanding fiscal deficits heighten the risk of default, which undermines its status as safe assets, he added.
The US abuse of financial sanctions due to dollar hegemony and the high national debt are eroding the credibility of the dollar, diminishing international investors' confidence, Chen said.
Tian attributed the downgrades to governance failure and the shortsightedness of bipartisan politics.
Despite the considerable amount of federal debt, it is not getting much attention from the contenders for the White House, US media reported.
National debt primarily functions as a financial tool rather than being shouldered directly by households, making it less of a focus for US voters, Tian said.
Hardly can both parties find a solution as debt is not a problem that can be fixed in one or two administrations, Ke said. It is an elephant in the room as the two parties diverge on how to reduce debt, she added.
According to her, the US political system, with its frequent changes in administration, makes it challenging to maintain a consistent long-term goal.
Chen said to effectively address the debt problem, the US government could either raise taxes or cut social welfare spending. However, higher taxes might dampen business sentiments, while cutting welfare could result in social discontent, making both options difficult to implement.
Tian warned of the potential risks brought by the surge in national debt as it could push up borrowing costs and increase risks to global financial stability, putting pressure on the economic growth of developing countries.
If the US debt problem leads to a global reassessment of the dollar's status, it could profoundly impact the international trade system that relies on the dollar, Ke added.
