US Capitol in Washington, DC, on May 11, 2023 (AFP)

According to the New York Times' editorial board, the government debt of the United States is as old as the country itself. In his book "In Defense of Public Debt," economist Barry Eichengreen says borrowing is efficient to mobilize national resources for governments in the face of existential crises like wars or pandemics, in addition to playing an important role in the global financial system to help economic growth.

The editorial board argues that the US has borrowed so much in times of economic growth that its policy has become "unsustainable".

According to the Congressional Budget Office, the yearly federal budget deficits will hover around roughly $2 trillion annually in the next 10 years, in addition to the $25.4 trillion the government currently owes creditors.

The authors note that a large part of the federal revenue that could go toward the people of the US is actually returned to investors who buy government bonds. Therefore, the rich are not taxed but rather paid to borrow money.

Read more: US debt hits new historic high

The Congressional budget office (C.B.O) also details that by 2029, the US government will spend more annually on interest than on national defense, and by 2023, interest payments will make up 3.6 % of the country's output.

Prior to the pandemic, a decade of extremely low-interest rates meant that, even as the government debt ballooned, interest payments were manageable. The government debt was nearly twice as high as a proportion of the national GDP at the beginning of 2020 as it was at the beginning of 1990, yet the burden of interest payments was only half as large.

However, the period of cheap interest rates is ending as borrowed money is becoming more expensive. The authors write that it is critical that the nation's leaders set a new route.

When last month Democrats and Republicans reached a deal to raise the debt ceiling, the C.B.O. predicted that the debt would reach $46.7 trillion by 2033. Following the agreement, the total was predicted to be just slightly lower, at $45.2 trillion, meaning 115% of the country's yearly economic output, the highest figure ever recorded.

President Joe Biden then stated that even more needed to be done to reduce the deficit and House Speaker Kevin McCarthy expressed that he was willing to form a bipartisan commission to “find the waste and we can make the real decisions to really take care of this debt.”

According to the editorial board, Republicans seem unbothered by the debt and have always passed tax cuts that force the government to borrow more. Meanwhile, they argue that Democrats have grown suspicious of requests to slash spending because apocalyptic forecasts have not come true and because they have learned the painful lesson that agreeing to expenditure cutbacks merely allows Republicans to justify another round of tax cuts.

They argue that the debt ceiling itself is an issue because it never limited the federal debt and was only enacted to facilitate borrowing.

The debt ceiling should be eliminated before its next planned appearance in 2025 as a first step toward resetting the discourse. President Biden has dismissed requests for his government to seek a judicial judgment declaring the cap illegal. In doing so, he is repeating his error from last autumn, when he failed to push for legislation to eliminate the ceiling. A case already pending in federal court in Boston, brought by federal employees worried that a default would jeopardize their pensions, provides a potential avenue.

Other legal options should be considered as well. It makes sense to seek justice while the ceiling is not imminently approaching. It would also be enlightening if the courts rejected the legal challenges.

The writers note that any meaningful agreement will have to include a combination of increased revenue and decreased spending, while Republicans will have to embrace the necessity of collecting what is owed to the government and raising taxes on the rich. Democrats also must recognize that adjustments to Social Security and Medicare, the two key drivers of future government expenditure increases, must be considered. According to the authors, anything else is not a viable solution.