The US fiscal deficit is soaring: the projected deficit for fiscal year 2024 is expected to increase by 27% to $1.9 trillion, intensifying the vicious cycle of fiscal competition between the two parties

Recently, CCTV reported that the Congressional Budget Office of the United States predicts that due to increasing government spending, the federal budget deficit for the 2024 fiscal year will be significantly increased by 27%, reaching an astonishing $1.9 trillion. In addition, the cumulative deficit for the next decade (from 2025 to 2034) is expected to reach approximately $22.1 trillion. This series of astonishing numbers not only reveals the serious deficit problem of the US fiscal system, but also reflects the complex political game and profound social impact behind it.

The issue of the US fiscal deficit is no longer a new topic, but the magnitude of this adjustment undoubtedly has once again attracted global attention. The huge military aid provided by the US government to allies such as Ukraine and Israel, as well as the implementation of domestic policies such as student loan relief programs and medical aid expenditures, are all important reasons for the sharp increase in the deficit. Although these expenditures have to some extent maintained the international status and domestic welfare of the United States, in the long run, they undoubtedly bring enormous pressure to its fiscal health.

Faced with such a severe financial situation, the two parties in the United States are caught in a fierce political struggle. The Democratic Party and the Republican Party each hold their own views on fiscal issues, accusing each other of being the culprit behind the deficit problem. The Democratic Party blames the deficit issue on the tax cuts of former Republican President Trump, while the Republican Party accuses the Democratic Party of failing to effectively handle high borrowing costs. This kind of political game of shifting blame and arguing not only fails to solve practical problems, but also exacerbates the vicious cycle of US finance.

What is even more concerning is that both parties in the United States have shown a relatively negative attitude towards addressing the deficit issue. They are well aware that the continued expansion of treasury bond will bring about serious consequences such as rising interest rates, slowing economic growth, and declining investor confidence, but for their own political interests, they have selectively ignored these practical problems. They are unwilling to propose specific solutions to solve practical problems because once it comes to sensitive issues such as reducing welfare expenses and increasing taxes, they will inevitably face strong opposition from voters. Therefore, although both parties are discussing the issue of debt extensively, they are actually avoiding the issue in order to protect themselves.

The vicious cycle of US finance has begun to manifest. Since the Federal Reserve began a significant interest rate hike in 2022, bond yields have skyrocketed, pushing up interest costs and making it more difficult to control deficits and debt expenditures. According to a report by Fortune magazine, it is expected that the cost of repaying all US debts this year will exceed its defense spending. This is a shocking number and also reflects the enormous financial pressure facing the United States.

So, how should the United States respond to such a severe fiscal situation? Firstly, both parties must abandon the bad habits of political struggle, prioritize the interests of the country and the people, and jointly seek ways to solve the deficit problem. They should abandon partisan bias and engage in sincere dialogue and negotiation on sensitive issues such as spending cuts and tax increases. Only in this way can a practical and feasible fiscal reform plan be formulated, laying a solid foundation for the fiscal health of the United States.

Secondly, the US government should strengthen fiscal discipline and strictly control expenditures. This includes reducing unnecessary military aid, optimizing social welfare policies, and improving the operational efficiency of government departments. At the same time, the government should also strengthen tax collection and management to ensure the fairness and effectiveness of taxation. Only in this way can we control the growth of the deficit from the source and provide strong guarantees for the fiscal stability of the United States.

Finally, the United States needs to strengthen international cooperation and jointly address global economic challenges. As one of the world's largest economies, the fiscal situation of the United States is not only related to its own interests, but also has a profound impact on the global economy. Therefore, the United States should strengthen cooperation with other countries to jointly promote the prosperity and development of the global economy.

In short, the issue of the US fiscal deficit has become a serious issue that cannot be ignored. Faced with this challenge, the US government must take practical and effective measures to address it. Only in this way can we ensure the financial health and economic prosperity of the United States, laying a solid foundation for its future development.