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The national debt expanded from US$2 trillion in Sept. 2017 to US$30 trillion in February 2022.
On Tuesday, the U.S. House of Representatives canceled a scheduled vote on a temporary government funding bill, further hiking shutdown risk as the Sept. 30 deadline approaches, while the national debt breaks US$33 trillion.
The canceled vote was for a short-term stopgap spending bill, known as a "continuing resolution" that could keep the government running until Oct. 31, giving Congress more time to enact full-scale appropriations for 2024.
Two groups of House majority Republicans -- hardline House Freedom Caucus and moderate Main Street Caucus -- reached the tentative bill on Sunday, which intends to tighten border security, cut federal spendings excluding those on defense, veterans, or disaster relief by 8 percent, and stop increasing aid to Ukraine, in exchange for 1 percent of overall spending cut.
Yet at least a dozen hardline members came out against the deal or expressed skepticism. Rep. Matt Gaetz called the tentative deal "a betrayal of Republicans" on social media. Rep. Majorie Taylor Greene posted: "I'm a NO!" on Tuesday.
US National Debt has has crossed above $33 trillion for the first time, just 3 months after hitting the $32 trillion mark. Over the past five years, the national debt has increased by 54%, moving from $21.5 trillion up to $33 trillion.
House Speaker McCarthy urged Republicans to pass the continuing resolution, warning against political fallout in case of a shutdown.
"I've been through shutdowns and I've never seen somebody win a shutdown because when you shut down, you give all your power to the administration," McCarthy said on Sunday.
The U.S. Chamber of Commerce issued a memo Monday to the business community, warning of the negative impact a prolonged shutdown can have on the country's economy.
"From passports and permits to clinical trials and contractors, a well-functioning economy requires a functioning government," the chamber wrote.
Congress has so far enacted none of the 12 appropriations bills setting discretionary spending levels. The House has just five days left in session before the Sept. 30 deadline to avert a shutdown.
No president in US History added more to the National Debt than Donald Trump. It is a fallacy that Republicans are better equipped to run the economy. Voters must face reality when they make choices. President Biden produces jobs, and a growing economy for Americans.#FreshStrongpic.twitter.com/DN9vK3e1Wt
In case of failure, thousands of government employees would stop working, with business interrupted and the economy dragged down. Goldman Sachs estimates that every week of governmental shutdown kills the U.S. GDP growth rate by 0.15 percent.
The last federal government shutdown happened between December 2018 and January 2019, which cost Americans 3 billion dollars, according to the Congressional Budget Office.
The current deadlock occurs amid the deteriorating U.S. fiscal crisis. Credit ratings agency Fitch on Aug. 1 downgraded the U.S. government's credit rating from the top-notch AAA to AA+ over concerns about "growing debt burden" and "an erosion of governance."
U.S. President Joe Biden signed the Fiscal Responsibility Act of 2023 into law to avoid a historic default on government debt, which reached in January its debt limit of US$31.4 trillion, more than 120 percent of its annual GDP.
The exploding U.S. national debt poses increasing risks to the global finance system. In less than five years, the debt expanded from US$2 trillion in September 2017 to US$30 trillion in February 2022. Goldman Sachs estimates it would exceed US$35 trillion by January 2025.