SAUNDERS: Who wins in 2024? Both parties agree: The rising tide of red ink

It’s been a little over a week since the Committee for a Responsible Federal Budget sent a letter to Kamala Harris and Donald Trump suggesting they get serious about “skyrocketing” national debt, which now exceeds $35 trillion.

Washington is spending $1.8 trillion more than it collects annually.

“Our publicly held debt will soon surpass the entire size of the U.S. economy, and debt is projected to exceed its previous record, 106 percent of GDP, in 2027,” the letter warned. “At a projected cost of $892 billion this year, our nation already spends more on interest on the debt than we do on both national defense and all federal spending on children.”

“The costs and promises just keep coming,” CRFB head Maya MacGuineas observed as we chatted over the phone Friday. As November nears, the candidates are dangling “expensive targeted breaks for groups of voters” with a “silly cynical patchwork of fiscal giveaways.”

CRFB crunched the numbers from the Harris and Trump campaign troves and reported that Harris scored better than Trump.

The fiscal watchdog group factored three outcomes — low impact, high impact, and in between — of each candidate’s proposals and figured the impact on the national debt for Plan Kamala could be as low as zero or as high as $8.1 trillion over 10 years starting in 2026.

For Trump, the range could be as low as $1.45 trillion or as high as $15.15 trillion over the same period.

That would be on top of the $1.8 trillion or so in debt that we already accumulate each year.

Since the letter went out, MacGuineas noted, there has been another natural disaster, Hurricane Milton, and Harris promised to have Medicare fund at-home, long-term care and Trump promised a new tax break on car-loan interest. So those estimates can only grow.

MacGuineas knows that the longer Washington puts off addressing America’s over-indebtedness, the more painful the remedy will be.

Because really, the only way to eliminate the money gap and put federal spending on a sustainable path would be to address entitlement spending. But you don’t hear either candidate talking about fixing Social Security or Medicare. Instead you hear about how they want to give away more money they don’t have.

Part of the problem is there is no crisis, just more red ink every year — our finances resemble the frog in the pot on top of a fire.

But it’s also true that with no crisis, this would be a perfect time to course-correct. The economy is strong enough to absorb the cost of what needs to be done.

Shortly after MacGuineas and I spoke, The Wall Street Journal reported that JPMorgan Chase Chief Financial Officer Jeremy Barnum said on a conference call that after a recent interest rate cut, the U.S. economy is in a “kind of Goldilocks” situation.

Inflation is at 2.44 percent right now. But when interest rates climb, the cost of paying off the mountains of U.S. debt will climb as well.

So this would be a great time to right the ship, except that it’s an election year, and neither party wants to talk about paying the piper.

Republicans aren’t talking about cutting government to right the ship, MacGuineas noted, and Democrats aren’t pushing for the broad tax hikes necessary to pay for their programs.

I asked MacGuineas: What should voters be pushing for?

A pledge from candidates, MacGuineas responded, and it’s simple: “No new borrowing until they fix this situation, barring emergencies.”

That makes so much sense, you know it won’t happen.

Contact Washington columnist Debra J. Saunders at dsaunders@reviewjournal.com. Follow @debrajsaunders on X.