National Debt and the Next Generation

The Next Generation Will Know Debt Like No Other.

They are burdened by record student debt. They are entering the workforce during a time of unprecedented economic uncertainty, in a nation with crumbling infrastructure, a climate in crisis, and rising inequality.

On top of all this, they will inherit a costly legacy in the form of America’s national debt. Today it already stands at $31 trillion. But it will rise rapidly in the coming years, growing to $52 trillion by 2033.

Young Americans are set to inherit a budget and economy that leaves them worse off than their parents and less prepared to respond to future crises — the opposite of the American dream. Just as climate change and inequality pose significant challenges to our future, so too does our unsustainable fiscal outlook, which threatens not only our economy, but key safety net programs which are so critical to vulnerable Americans.

The next generation should be able to define their own path, control their own destiny, and choose their own policies, without the burden of paying the ongoing bill for our own needs from the past. A just and moral America is founded on the principle that we leave the next generation better off — with the financial freedom to decide how to direct their own future resources in the most effective, equitable, and prosperous way.

It is what we do now — today — that will set the next generation up for success tomorrow. The good news is that our unsustainable fiscal path can be solved.

Growing levels of youth unemployment, along with the long-term trend of sluggish wage growth, threaten the economic opportunities available to future generations. Saddling future workers with an unsustainable national debt will further limit their ability to overcome those trends, with downward pressure on wages and productivity. To put it simply, the more debt we carry, the less resources we have available to invest in our future.

The United States has the most expensive healthcare system in the developed world, without delivering better health outcomes. Rising costs all too often can have a devastating impact on individual or family finances. Moreover, our broken, inefficient healthcare system poses a threat to our nation’s economy and fiscal outlook for generations to come. To unlock the full potential of our citizens, our economy, and our nation, we need to address healthcare costs and ensure that our system provides better quality at a lower cost.

Wealth and income inequality have risen sharply over the past few decades. The many potential solutions to addressing the needs of our most vulnerable populations all involve resources and funding for policies and programs. Addressing our fiscal challenges and putting our debt on a sustainable path would allow our government to better plan, prepare, and create a more equitable and inclusive economy.

Critical programs like Social Security, Medicaid, Medicare, SNAP and Unemployment Compensation are essential lifelines for our most vulnerable populations. However, America’s fiscal situation jeopardizes those programs, and absent reform, trust funds for Social Security and Medicare may face depletion while our unsustainable fiscal path may crowd out funding for the other safety net programs. We simply can’t let today’s irresponsibility and lack of planning threaten those vital programs for future generations.

To meet the critical challenge posed by climate change, we need resources, not only today, but tomorrow as well. As the frequency and intensity of climate-related disasters increases, maintaining a sustainable fiscal outlook will give us the financial strength to invest in ways to slow climate change, reverse its effects, and protect our economy and citizens.

The United States faces a complex and changing set of national security threats from around the world. There’s a fundamental link between our nation’s fiscal strength and our ability to meet these challenges and defend the nation’s interests. Stabilizing our national debt, which will allow us to maintain our level of preparedness and superior military strength, is essential for maintaining our leadership role in the world.

The rise in student debt has implications for young people and the federal budget. Studies show that excessive student debt can lead to a range of negative economic effects for individuals, including preventing young families from purchasing homes and restraining the growth of small businesses. And because 92 percent of student debt is issued by the federal government, the exposure to the federal budget increases as the amount of student debt climbs. Responsible borrowing on all fronts will help advance economic opportunities and prosperity for the next generation.