标签： North America

The recent milestone of U.S. national debt surpassing $40 trillion has ignited a sharp partisan battle on Capitol Hill, with congressional Republicans rushing to criticize Democratic economic policies as reckless, “unaffordable socialist spending” that has driven the nation’s borrowing crisis. But independent economists and policy analysts are pushing back against that narrative, arguing that decades of Republican-led policy decisions — from sweeping tax cuts for the wealthiest Americans to costly discretionary military interventions in the Middle East — are the primary drivers of the national debt’s rapid expansion over the past 25 years.

Central to this debate is the record of former President and current President Donald Trump, who campaigned repeatedly on a pledge to fully eliminate the national debt. Across his two terms in the White House, Trump has already overseen an $11.6 trillion surge in total national debt, a figure that outpaces the debt growth of any other modern U.S. president.

Dean Baker, a senior economist at the nonpartisan Center for Economic and Policy Research, framed the issue clearly in a commentary published Thursday. “I have never been a deficit hawk, and I’m not about to change my religious affiliation now,” Baker wrote. “But whatever we think of debt and deficits, there is one point that should be very clear: It has been run up almost entirely due to Republican tax cuts and their inept management of the economy.”

Nobel Prize-winning economist Paul Krugman echoed that assessment, noting that while the $40 trillion figure itself holds no inherent special economic meaning, it serves as a stark reminder of the fiscal irresponsibility of the Trump administration. Krugman pointed to unfunded tax cuts that disproportionately benefit the top 1% of earners, billions in unnecessary wasteful military spending — including costly redesigns of aircraft carriers undertaken solely because Trump disliked their original appearance — as key contributors to ballooning borrowing.

Krugman added that the nation’s deficit outlook would be far more stable today if not for the large, inequality-widening tax cuts rammed through by successive Republican presidents George W. Bush and Donald Trump, both of which heavily favored high-income households.

Data from Bobby Kogan, senior director of federal budget policy at the Center for American Progress, backs up these claims. In a 2023 analysis, Kogan found that tax cuts passed under the Bush administration and during Trump’s first term accounted for 57% of the total growth in the U.S. debt-to-GDP ratio since 2001. When one-time emergency spending to address the 2008 Great Recession and the 2020 COVID-19 pandemic is excluded from calculations, that share jumps to more than 90% of all debt ratio growth over the period.

Just last summer, Trump signed into law yet another massive tax cut package that will deliver disproportionate benefits to wealthy households and large corporations, and is projected to add trillions of additional dollars to the national debt over the coming decade.

Former U.S. Labor Secretary Robert Reich highlighted a further layer of inequity in the current system in his Thursday commentary. “From now on, whenever you hear someone fret about how huge, horrible, and out-of-control the national debt is, explain to them that it’s largely because of tax cuts to the wealthy – who are also the major recipients of interest on that debt,” Reich wrote.

The $40 trillion debt milestone was reached several months earlier than independent forecasters initially projected, a gap partially attributed to lost federal revenue from Trump’s trade tariffs that were later invalidated by federal courts.

Democratic lawmakers have joined economists in calling out Republican fiscal hypocrisy. “Before his second term is even over, Donald Trump is responsible for more than $10 trillion of this,” Representative Chris Deluzio of Pennsylvania wrote Thursday. “Just INTEREST on this debt is now sucking up more of our public money than even the military and Medicare. DC Republicans are leaving our kids a colossal mess to clean up.”

For millions of working and middle-class New Yorkers, achieving homeownership in one of the world’s most expensive urban centers already feels like an unattainable fantasy. Yet for a small, wealthy subset of residents and out-of-state elites, the city is not just a place for one primary residence – it is a location for a second luxury pied-à-terre. To address the city’s crippling housing affordability crisis and fund critical social programs, New York Mayor Zohran Mamdani has introduced a groundbreaking annual tax on high-value second homes, but the policy’s botched rollout has sparked fierce public backlash and legal challenges.

Under the new policy, the tax applies to second homes valued at more than $5 million, as well as condos and co-ops worth over $1 million. As part of the rollout, the city published a public list of nearly one million properties that could be subject to the new levy, releasing the names and addresses of high-profile homeowners including hedge fund billionaire Ken Griffin (owner of a $239 million Manhattan penthouse), filmmaker Woody Allen, former Vogue editor Anna Wintour, and actress Cynthia Nixon. Ultimately, the city issued formal tax notices to just 17,000 property owners, but the public disclosure of the broader list became the central flashpoint at a heated City Council oversight hearing held this week to examine concerns over the policy’s implementation.

While some council members, including Gale Brewer, have voiced support for the core idea of a second home tax, they have acknowledged significant procedural flaws in how the policy was rolled out. Critics on the council have gone much further: Council member Kamillah Hanks slammed the public list as an unfair “hit list of the haves and the have-nots” that stigmatizes property ownership and creates unacceptable public safety risks, arguing that the disclosure frames legitimate homeownership as something to be ashamed of.

The New York City Department of Finance has defended the release of the information, noting that address and ownership data is already required by law to be made public annually. But critics across the real estate sector and homeowner groups warn the aggregated list creates a dangerous tool for scammers and bad actors, putting wealthy homeowners at heightened risk of fraud, harassment, and even targeted crime. Jason Haber, leader of the American Real Estate Association, notes that the confusion and backlash around the tax has already led some prospective high-end property buyers to pause purchases in the city, a trend he argues could eventually offset the $500 million in annual projected revenue the tax is expected to generate. A group of homeowners has already filed a lawsuit demanding the city remove the nearly one million-name list from public view.

Supporters of the policy, however, dismiss the backlash as overblown, framing the tax as a long-overdue measure to address New York’s staggering socioeconomic inequality. Dave Backer, a school finance professor, argued that wealthy opponents of the tax are protesting far more than the policy warrants. Beverly Solo, a 44-year New York resident who attended the hearing wearing a “Tax The Rich” shirt, noted that the revenue generated by the levy will fund critical public services that benefit all city residents. “It seems reasonable and fair to ask those who don’t pay full-time income taxes here, but have luxury homes here for pleasure, to contribute to the wellbeing of New York City,” she said, though she conceded the rollout of the policy had been “a mess.”

Mayor Mamdani has stood firmly behind the policy, framing it as a fair mechanism to generate $500 million in annual revenue that will fund his campaign promises of universal child care, improved and free bus service, and other social programs targeted at New Yorkers struggling with housing and cost of living. Crucially, the policy has won the backing of New York Governor Kathy Hochul, who previously held reservations about raising taxes on state residents. Still, the rollout has faced repeated setbacks: Mamdani’s administration declined to attend this week’s oversight hearing, a decision that angered attendees. A spokesperson for the mayor explained the administration had requested to delay the hearing amid ongoing litigation over the policy, and that city officials are barred from testifying on a matter currently before the courts.

Similar secondary property and empty home taxes have been implemented across the globe, with mixed results. In Paris, France, secondary properties face a 60% local tax surcharge that has generated billions of euros in public revenue. Vancouver, Canada introduced a 3% empty homes tax in 2017 to improve housing affordability; research found the tax raised nearly $194 million over eight years and reduced housing vacancies by 21%, but had little impact on lowering average rental costs. In 2022, San Francisco voters approved an empty homes tax, but the policy was found unconstitutional by a court following a lawsuit from real estate groups, and remains tied up in appeals.

Even some prominent supporters of the New York policy acknowledge that the public disclosure of the property list was an unforced error. Morris Pearl, a former BlackRock managing director and chair of Patriotic Millionaires, a group of wealthy Americans who support higher taxes on the rich, noted that “the mayor himself … sort of unnecessarily antagonises people occasionally.” Still, Pearl says he stands firmly behind the policy itself, arguing that claims the tax will drive away wealthy investment are absurd: “Someone who owns a residence that is not their primary residence that’s worth more than $5m has the ability to pay more than most New Yorkers do.” As litigation moves forward, the future of both the controversial tax rollout and the policy itself remains undecided.

In an upset result that has sent ripples through Florida’s political landscape, a democratic socialist candidate has secured a surprise victory in the state’s U.S. Senate primary, granting an interview to the BBC shortly after the final results were confirmed. The unexpected primary win sets the stage for a high-stakes general election battle this November, where the victorious candidate, named Nixon, will go head-to-head with sitting Republican Senator Ashley Moody. Political analysts have already framed the upcoming race as one of the most competitive contests in the 2024 election cycle, given Nixon’s unorthodox progressive platform that defies traditional Democratic positioning in the traditionally conservative-leaning swing state. Incumbent Senator Moody, who ran unopposed for the Republican nomination, now faces a far more challenging campaign than many party insiders initially predicted, as Nixon’s surprise primary win has energized grassroots progressive voters across the state and drawn national attention to the Florida Senate race.

Nearly half a year has passed since U.S. President Donald Trump first promised a rapid resolution to the escalating standoff with Iran. Today, the confrontation between the two nations remains locked in a stalemate, with neither a clear military breakthrough nor a viable negotiated settlement on the horizon.

In a bid to break this impasse, the Trump administration has announced a sweeping new pressure campaign it has dubbed “economic D-Day.” Under the proposed framework, any nation that continues to maintain commercial ties with Iran will face severe, far-reaching economic penalties from the United States. This escalated move comes as the White House doubles down on economic coercion after other tactics failed to deliver the desired outcome.

For decades, Iran has weathered successive waves of U.S. sanctions, and as the current conflict drags on, the country has repeatedly demonstrated its ability to withstand severe economic strain and adapt to intense pressure. That track record leaves a critical open question: can this new round of sanctions succeed where all prior U.S. strategies have fallen short?

Full details of the new U.S. economic pressure campaign have not yet been made public. Treasury Secretary Scott Bessent has confirmed that the full framework will be unveiled during a scheduled press conference on August 24. Speaking in an interview with CNBC, however, he made clear that Washington’s crackdown will extend to all nations—whether traditional U.S. allies or geopolitical rivals—that the administration accuses of propping up Iran’s economy. “You are either with us or against us,” Bessent stated, adding that if any nation insists on engaging in business with Iran, from facilitating money transfers to purchasing Iranian oil or conducting maritime trade transfers, the full weight of the U.S. Treasury and the entire U.S. government will be brought to bear to enforce penalties against them.

Vice President JD Vance has framed the new sanctions as a defining “new phase” of the confrontation, arguing that economic pressure represents the most effective tool currently available to the U.S. Appearing on the *Clay Travis and Buck Sexton Show*, Vance claimed that “They’re going to try to apply economic pressure to us, but what has been true over the last couple of weeks is that they felt a lot more pressure than we have. We’re going to keep that going because we think that’s the best way to ultimately achieve the final objective.”

U.S. sanctions against Iran date back to the founding of the Islamic Republic in 1979. The pressure campaign intensified dramatically after the first Trump administration withdrew the U.S. from the Joint Comprehensive Plan of Action (JCPOA), the 2015 nuclear agreement reached between world powers and Tehran to limit Iran’s nuclear program. Since the start of the current conflict, the administration has already rolled out Operation Economic Fury, a two-pronged initiative that combines Treasury-coordinated sanctions targeting the Iranian regime’s financial flows with a naval blockade of Iranian ports.

Geostrategy experts say the latest announcement of “economic D-Day” stems directly from the White House’s growing frustration that existing tactics have not achieved Trump’s goals. “This is really a recognition that the U.S. is almost stuck in this war,” explained Imran Bayoumi, a geostrategy expert at the Washington-based Atlantic Council and a former policy advisor to the U.S. Department of Defense, in an interview with the BBC. “It’s another try at economic pressure. We’ve not seen a clear strategy laid out by the administration with either military or economic tools. The question of what the U.S. is trying to achieve is still unanswered.”

Michael Parker, an eight-year veteran of the U.S. Treasury’s Office of Foreign Assets Control (OFAC) and a leading expert on economic sanctions, noted that the new strategy is designed to expand the scope of existing sanctions by targeting third countries that still trade with Iran and rely on access to the U.S. dollar. “Thus far, the U.S. has largely used the threat of these secondary sanctions against foreign financial institutions to encourage compliance with sanctions policy,” Parker said. “But this is a lever that is sort of unexplored insofar as targeting anything touching the U.S. dollar that is also touching Iran.” He pointed to foreign financial institutions that facilitate sanctions evasion by Iran or channel funds directly to the Iranian government as key potential targets.

While it remains unclear how Iran will respond to the latest round of sanctions, sanctions specialists have noted that Iran has a long track record of adapting quickly to circumvent restrictions. Iranian actors have honed sophisticated workarounds, including the use of unregistered “shadow” oil tankers and front companies that do not appear on U.S. sanctions blacklists. “You keep seeing new names popping up, because Iran is adapting really quickly,” said Mohammed Hammouda, an export control and sanctions manager at the London Stock Exchange. “Whatever sanctions one does, they find a new road around it. Sanctions are all on paper, but the hard work is behind the scenes. There are teams worldwide trying to impose sanctions and identify those parties involved, which is why Iran has to try to adapt.” Hammouda added that Iran’s adaptive tactics often leave sanctions enforcement teams constantly playing catch-up to the country’s workarounds.

The ultimate effectiveness of the new sanctions will depend largely on how targeted third countries respond. Potential targets include U.S. allies such as Turkey and Iraq, as well as major economic power China. “Some of this is out of Iran’s hands,” Parker explained. “Iran’s ability to evade or avoid sanctions is, in large part, contingent on other countries and financial institution’s willingness to give them access to the formal banking system. Sanctions are only as powerful as the willingness of targeted countries to comply with American foreign policy objectives, or face potentially painful sanctions on trade involving the U.S. dollar.”

Many experts question whether major powers will agree to comply with the U.S. crackdown. “I can’t really see China agreeing to that, for example,” Bayoumi noted, adding that “These states have all been able to navigate their own interests with the Trump administration. The underlying point is that this is just another tool. But the broader question of strategy remains. Absent that, I’m not sure this is going to change anything long term.”