‘We owe it to the next generation’ to control national debt, says think-tank boss amid $1.2 trillion in U.S. borrowing over six months

(SeaPRwire) –   The Congressional Budget Office’s most recent monthly budget report indicates that the U.S. government ran a deficit of $1.17 trillion during the first half of the fiscal year, spanning October 2025 to March 2026.

Though the deficit is lower than the gap recorded in the same timeframe last year (partly due to President Trump’s tariff policies), the reality is that the U.S. is adding even more debt to its existing $39 trillion pile. Beyond the primary deficit, economists are also worried about the interest payments needed to cover the debt—projected to exceed $1 trillion this year.

Public debt is a concern for a wide range of figures, including Federal Reserve Chair Jerome Powell and JPMorgan Chase CEO Jamie Dimon. Numerous experts have hypotheses about how this borrowing could harm the economy over time—from crowding out public investment to a market “correction” where bond investors insist on higher returns for their loans. Some others propose that inflation might simply be allowed to rise, which would gradually reduce the real value of the debt.

In fact, for many, the debt’s absolute value isn’t the issue. Their alarm stems from the growing imbalance in the debt-to-GDP ratio and the fact that the U.S. economy isn’t expanding quickly enough to keep pace with its borrowing rate.

More optimistic economic analysts might claim the U.S. economy can grow itself out of a crisis (with AI’s potential transformative impact possibly serving as a quick fix), while others note that 10- and 30-year Treasury yields aren’t showing any signs of distress.

Michael Peterson, chairman and CEO of the Peter G. Peterson Foundation, cautions that the absence of market warnings right now doesn’t mean problems won’t emerge later. The Peterson Foundation has long advocated for a more sustainable fiscal trajectory for the U.S. economy.

“I believe the bond market is frequently a strong indicator of risk-related sentiment,” Peterson stated in an exclusive interview with . “That’s the focus of these professionals every day, and there’s a massive market that captures all of their collective thinking on the matter. Since the bond market is performing reasonably well, they don’t anticipate a total collapse in the short term.”

But Peterson noted that fiscal choices from both political parties are “extremely harmful, even without a crisis”: “When you look at a company, it’s not the case that ‘as long as it’s not bankrupt, everything’s okay.’ Companies make decisions that are inefficient and hurt growth—they take on too much debt, and while they might not go bankrupt, they harm their own prospects.”

“This is a self-inflicted crisis we’ve created, regardless of what the bond market might do on top of it,” Peterson continued. “I believe we have a responsibility to the next generation to bring this under control.”

There’s also the question of how the borrowed money is used: The CBO reports that a large share of government spending ($1.7 trillion) goes toward immediate, mandatory costs like Social Security, Medicare, and Medicaid.

Although these programs are important, Peterson pointed out that they don’t offer the same return on investment as spending on infrastructure or education would for future generations: “Even if we never face a crisis, these trillions of dollars—most of which have gone toward immediate consumption with no long-term economic benefits—have harmed our children and grandchildren,” he added.

Future generations

The economics community is also divided over which group of consumers will bear the brunt of the national debt burden: Some say retirees could be hit hardest, as their 401(k)s aren’t adjusted for inflation and their savings might be reduced by “financial repression”—a practice where the government keeps interest rates artificially low to make public borrowing less expensive.

Others contend that a market correction would drive interest rates higher, meaning people with mortgages (or those looking to get one) would suffer the consequences.

Peterson believes that regardless of the scenario, younger generations will take the biggest hit: “I think it’s difficult to figure out exactly how the pain would play out, but it will be widespread, significant, and long-lasting. We can argue about who gets the worst deal, but it’s clear we’re letting down everyone who will be part of the economy in the future.”

“I definitely worry that the most vulnerable will suffer if this debt crowds out income support and other programs the government could have funded if it had more resources.”