What A Day - How Trump Increasing The National Debt Impacts You

Episode Date: August 21, 2026

The United States national debt reached a record-breaking $40 trillion dollars this week. If you spread out that debt to every resident of the U.S., we would each owe more than $115,000 dollars. So how did we get here? To find out more about what our big bad debt means for you, we spoke with Scott Lincicome. He’s the vice president of general economics at the Cato Institute.And in headlines, Trump-fixer-turned-frenemy Michael Cohen hosted the president on his radio show, the USS George Washington aircraft carrier is relieving the long-deployed USS Abraham Lincoln, and a Texas court slashes a $50 million judgment against Infowars founder Alex Jones to about $6 million.Show Notes: Call Congress – 202-224-3121 Subscribe to the What A Day Newsletter – https://tinyurl.com/y4y2e9jy What A Day – YouTube – https://www.youtube.com/@whatadaypodcast For a transcript of this episode, please email [e-mail] Follow us on Instagram – https://www.instagram.com/crookedmedia/

You hear people on the left, oh, if only we hadn't done those tax cuts, and if only we'd tax billionaires, we'd be fine. No, no, that's totally, totally not true. It just simply was adding one more log on a massive bonfire. And the massive bonfire is this really unsustainable entitlement system that is politically bulletproof, yet a big problem just in terms of the numbers. I'm Jane Koston, and this is Waday. show that is here to say, don't worry about the national debt, because Vice President J.D. Vance told Newsmax on Thursday that actually it's former President Joe Biden's fault. Even though the debt is too high, even though we inherited this debt bomb for the Biden administration,

we actually do have a plan to get the economy growing faster than the debt, and that's the most important thing. Sure, J.D., President Donald Trump had nothing to do with the national debt, and the man who loves debt has a plan to fix it. On today's show, Hey, how did our national debt get so big? To find out, I spoke with the Cato Institute, Scott Lunswickham. Before we get into the terrible multi-trillion dollar debt, here's what we're following today, Friday, August 21st. They weaponized you like nobody's ever been weaponized, like few have been. Well, maybe just you and I, sir. And you. Yeah, me too, but I don't consider mine, you know, mine was at a level that nobody's ever seen before.

but they weaponized you. They weaponized a lot of people. And I respect the fact that you recanted everything you said. And that's a big thing that you did. Yikes. Someone is really working hard to get that pardon. And by someone, I mean former Trump fixer turned friend of me, Michael Cohen. Yep, you heard that right. Trump appeared on Cohen's radio show holding quite the public reunion with the man who once called him a quote,

Cheeto-dusted cartoon villain. and testified against him both in court and Congress. Remember Stormy Daniels and Trump's hush money case? Yeah, well, Cohen served actual prison time for his role in what he said was covering up Trump's, quote, dirty deeds. Part of Cohen and Trump's interview aired on Cohen's radio program Thursday. It was an exceptionally friendly affair with only passing reference to the men's tumultuous history. And we weren't kidding, Cohen told CNN before the interview aired,

that he had resubmitted a pardon applicant. Girl, come on. The U.S. military said Thursday the USS George Washington aircraft carrier is now operating in the Middle East. It's relieving the long-deployed USS Abraham Lincoln, which has been supporting Trump's war against Iran. The new vessel's arrival comes amid growing concern about the Lincoln's lengthy deployment, which has included a record-setting uninterrupted time at sea, reports of crew stress, poor mental health, and supply shortages, including food and hygiene products. It's not clear when the Lincoln will arrive stateside or whether it will make a port stop along the way, but the journey will take just over a month.

Can we just get these sailors off the damn ship already? A Texas court slashed a $50 million judgment to about $6 million against InfoWars founder Alex Jones after he falsely claimed the Sandy Hook Elementary School mass shooting was a hoax. The unanimous opinion found that Sandy Hook parents, Neil Heslin and Scarlett Lewis, did not show evidence that harassment inflamed by Jones's hoax. claims rose to a level that would allow them to exceed the state's cap on damages for each plaintiff. Heslin and Lewis's six-year-old son was among 20 children and six educators killed in the 2012 attack in Connecticut. The ruling today does not affect the more than $1 billion judgment against Jones in Connecticut. Still, it's a significant legal victory for him after he and his company, free speech systems, were found liable for damages for claiming the mass shooting didn't

happen. I heard you missed me. Here I am. Welcome to the White House. First Lady Melania Trump made a rare public appearance on Thursday in support of a government initiative to help young people transition out of foster care. But the context of her appearance is more interesting. Let me back up and start with Natalie Harp, Trump's 35-year-old personal assistant and, quote,

human printer. But her largely under the radar picture. position ended when Georgia Democratic Senator John Ansov mentioned her name in passing, and the White House and the entire MAGA media sphere collectively lost its mind. But the White House freak out made a lot of people, and reporters ask, hey, who exactly is this woman and what is she doing being so close to the president? The answer is, as far as we know, being hopelessly and worryingly devoted to Donald Trump. In letters published by The Daily Beast on Thursday, Harp wrote to Trump in 2020.

quote, I never want to bring you anything but joy. I'm sorry, I lost my focus. You are all that matters to me. According to New York Times reporter Maggie Haberman, Harp's letters deeply worried the Secret Service. I get it. And that's the news. Let's talk about debt.

The U.S. national debt reached $40 trillion this week. That's a massive number. How massive? Take one billionaire. The musician, and Fenty founder, Rihanna, for example. It would take the net worth of 40,000 Rianas to pay the cost of the current U.S. national debt. Let me make it even more clear.

If you spread out that debt to every resident of the U.S., we would each owe more than $115,000. How did we get here? It was a bipartisan effort across different presidencies, congresses, and parties. The U.S. has continued to spend while not bringing in nearly enough revenue to make up for it. And President Trump's home renovation projects and war of choice, not to mention his tax cuts for those aforementioned billionaires, certainly haven't helped. To find out more about what our big, bad debt means for you, I spoke with Scott Lunswickham. He's the vice president of General Economics at the Cato Institute. Scott, welcome back to Water Day.

Thanks for me back. So on Wednesday, the U.S. Treasury reported that the national debt has broken a new record passing an eye-watering $40 trillion. How did we get here? Well, we created a lot of programs that made a lot of sense when young people outnumbered old people and don't make as much financial sense today. More seriously, yeah, the reality is that mandatory spending in the United States has, as a share of GDP, expanded a lot over the last. several decades, and it's primarily because of entitlements, but the other big thing is interest

payments because interest rates have risen. So when you look at the amount that the government has to spend every year on these types of things, it just has kept going up and up and up. Now, meanwhile, taxes and the amount of revenue we're bringing in has remained flat. It hasn't actually gone down despite all the tax cuts and everything. But the problem is when you have spending that goes way up and revenue that stays flat, you just start taking on debt. And it's basically doubled the debt in the last decade plus. And so now we hit the big 40 trillion number. And when we talk about entitlements, that's like social security, right? Yeah, social security, Medicare, Medicaid, all that kind of stuff. That times have changed and the

programs really haven't. As I discuss often, being 65 is very different now from what it was in like 1965 or kind of the origins of these programs. But I am a millennial. So I recall at the end of the Clinton administration, we had a budget surplus. And people were like, yeah, woo. Well, a lot has happened about 26 years have passed. You mentioned that spending has gone up of the last couple decades. How? Why? Yeah. So again, a lot of it is, because you have to remember during the Clinton years, what was zeroed out was the deficit, not really the debt trajectory per se, right? And now, of course, because the deficit was flat, the debt, which is the whole enchilada,

wasn't expanding very quickly. But the reality is that even back in the wonderful 1990s, when I was enjoying Grunge Rock and totally oblivious to all of this, some of these big drivers of our future spending challenges were already there. I mean, I remember I interned at the Cato Institute in the late 1990s, and even then, folks were warning that, hey, at some point in the future, Social Security and Medicare are going to be a problem. It's just a math issue and a population issue, right? And there's no, we're not having a lot of babies these days. We are, we have some immigrants, but definitely not enough to take care of the budget shortfalls. And eventually this was going to happen. But certainly

there are other things as well. I mean, several big crises, first the Great Recession, then, of course, the pandemic caused some of the debt trajectory to be supercharged a bit because you had trillions of dollars in additional spending during those periods. Now, any good Keynesian will say, well, you should spend during those emergency periods. The problem, though, is that we spent more during the non-emergency periods, too. I'm guessing, though, that the Trump's tax cuts did not help with this. Certainly. No, that's, and that's exactly right.

That we have been, we've kept cutting taxes as well. And again, you know, that's going to reduce revenues a bit, but it's really not the kind of catastrophic thing is played out. You hear people on the left, oh, if only we hadn't done those tax cuts, and if only we'd tax billionaires, we'd be fine. No, no, that's totally, totally not true. It just simply was adding one more log on a massive bonfire. And the massive bonfire is this really unsustainable entitlement system that is politically

bulletproof, yet a big problem just in terms of the numbers. If the visual of our national debt is a raging bonfire didn't quite make you feel warm and fuzzy, stick around. We'll go back to my conversation with Scott Linscombe in a moment. In the meantime, make sure to subscribe. Leave a five-star review on Spotify and Apple Podcasts, watch us on YouTube, and share with your friends. More to come after some minutes. What Today is brought to you by Delete Me.

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Get 20% off your DeleteMe plan where you go to JoinDeletMe.com slash Wad and use promo code Wad at checkout. The only way to get 20% off is to go to www.com joindeletme.com slash Wad and entercode Wad at checkout. That's www.com.com code Wadterday is brought to you by Zbiotics. Let's face it, after a night with drinks, I don't bounce back the next day like I used to. I have to make a choice. I can either have a great night or a great next day. That is until I found pre-alcohol. Zibiotics pre-alcohol probiotic drink is a world's first genetically engineered probiotic. It was invented by PhD scientists to tackle rough mornings after drinking. Here's how it works. When you drink, alcohol gets converted

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Now, I can feel people in the audience whose eyes have glazed over like five minutes ago because talking about this feels really abstract and this is not your fault nor is it mine. These numbers are so big that it's hard to even comprehend. Like we're not talking about like, you know, one person's credit card debt. We're talking about the country being $40 trillion in debt. But what does that mean for you and me and my dog and your dog? Right. So there's two things that I think we should care about. And the first and the most obvious right now are interest rates. When the government spends more than it takes in for a very, very long amount of time, it has to issue that debt. People buy that debt. But to convince people to

buy that debt, you have to offer higher interest rates, right? You know, I want to make sure I'm going to get paid back. And as a borrower gets a little bit riskier, I'm going to ask for a higher interest rate, right? So in very simple terms, what that means is that interest rates, bond yields, that kind of stuff, go up. And that means eventually mortgage rates are higher and other types of, you know, rates, interest rates that we pay as everyday consumers. will go up. The second thing that you really can't see is that all of this debt tends to crowd out private economic activity. So the government's kind of e-elboing its way into financial markets and to the real markets. And you can't see this, but it just kind of means a slower economy, less economic

output. So you get higher interest rates and you get slower output. The other thing that hasn't happened and hopefully will never happen is that eventually when you have countries with a lot of debt, borrowers finally say to heck with this, we're not buying your debt anymore. And then you have like a full-blown debt crisis, right? You don't want to play footsie with something like that because then things get very, very bad. And you end up with mandatory benefit cuts. high skyrocketing inflation, really bad stuff. So that certainly hasn't happened yet. For the everyday person, the most notable thing is it's going to just show up in, you know, a mortgage rate that you really don't like.

So it will be harder to borrow money to buy a house or do pretty much anything, but it will also be harder to make money because the government is crowding out private businesses. Yeah. Yeah. And so it just ends up you have a slower, less, dynamic economy, which over the long term means we have lower living standards and all of that stuff, which again, we don't want. So one of the reasons that the debt passed $40 trillion months earlier than forecasted, which is a weird thing to say about $40 trillion, is President Trump's beloved tariffs, because from the Supreme Court struck them down in February, the government had to return

all of the duties collected. Who is getting their money back? Because it's not me. No, and you shouldn't really, I don't think, expect a tariff refund check anytime soon, contrary to what the president has claimed a few times. The reality is that the way the law works, and for very good reasons, I should say, the person who paid the tariff to the government, who actually stroked the check, is the person who gets the money back. Now, what that means in reality is that a lot of companies are getting big, fat tariff refund checks, and it's boosting earnings.

and it's actually helping a little bit, we think, with economic growth right now because companies have more money and they're spending it. What it doesn't mean, though, is that you're going to see lower prices across the board and big tariff refund sales or a tariff rebate check. You know, some companies, to their credit, have tried to give the money back. FedEx and DHL and these big shippers, they're sending it right back because they actually had a line item, you know, if you imported something from, you know, TEMU or whatever, uh, and it came via FedEx, you, you actually had a tariff line item. And FedEx is sending those

back. Uh, the problem is that most companies didn't put a tariff line item on your receipt. And instead, how do companies deal with tariffs? Well, they spread them out across their entire product mix. They absorb them. They do all of these different things. And so tracing where the tariff actually ended up to us consumers is basically impossible. So you shouldn't, for some good reasons, expect that. The other thing, though, is that, look, prices go up like a rocket. They come down like a feather. Companies are reluctant to lower prices once they've raised them. And it's just that's, you know, the nature of the market. And so I think some companies are just going to take the tariffs, pocket them, keep prices high and move on.

Scott, I also want to be clear. I would never say that you are boring. I was saying that talking about the federal debt is boring. I regret that it is boring. And yet it is $40 trillion. Yeah. And, you know, the fact is that it is really hard to talk about the stuff without getting into the weeds. Right.

And it inevitably is going to devolve into talking about numbers and nobody likes those. No. But people like knowing. what to expect from the economy. So what do you think people should know about the economy right now and how should they be preparing for the months and years ahead, given everything we've been talking about? Yeah, I mean, I think the U.S. and economy, there's good and bad. And it's far from the disaster that I think some on the left are painting out to be. It's far from the golden age that the president is painting out to be the AI-related investment.

construction and manufacturing, there are a lot of very cool and good things that are propelling the U.S. economy right now. And it's not just benefiting big tech. There's a lot of this trickling through the economy. The downside is that there's definitely a lot of disruption and even some displacement for certain occupations that even five years ago seemed like they were a no-brainer for a good job and long career, like say, kind of basic data entry and coding, that those are gone, right? Now, the data showed that companies are still hiring. It's not like there's no jobs, but it's different. And that kind of disruption is unsettling for a lot of people, and I think that's the case. So there's, those are some of the good, but there's also bad,

right? I mean, prices are still high, and inflation is down, but still way above where the Fed wants it to be. And even though wages have mostly kept pace, that's, I think, a big issue. And then finally, there's all the chaos, not just tariffs, but deportations and Iran. This is not just hard for us psychologically, right? All these crazy headlines. it's tough to process. But it's bad for the business environment. You know, we have kind of this no hire, no fire labor market because companies don't know what's coming next. They don't know what the next tariff rate's going to be or where they're going to find workers or on and on and on. And so that's bad. You want companies to be able to have certainty and predictability to invest

and save. And without that, it's hard, hard to deal with along with the higher prices. I agree. I hate chaos. Scott, thank you so much for joining me. My pleasure. That was my conversation with Scott Linsicum, Vice President of General Economics at the Cato Institute. Before we go, we don't need to tell you how important these upcoming midterms are or what's at stake. You already know, which is why you also know that we'll need everyone to pitch in and organize in their communities over these coming months. Check out our new collection of Vote Save State T's featuring nine of the most crucial battleground states

on the 26 map. Get yours and rep your state today at store.crocod.com. That's all for today. If you like this show, make sure you subscribe, leave a review. I must go to France to help with a champagne harvest and tell your friends to listen. And if you're into reading, not just about how French grape growers are picking millions of grapes

as heat waves have made this the earliest champagne grape harvest on record, like me, What a Day is also a nightly newsletter. Check it out and subscribe at crooked.com slash subscribe. I'm Jane Koston. And when I say, help with the champagne harvest, I really mean help drink the champagne. Sorry for any confusion.

What a day is a production of Crooked Media. Our show is produced by Caitlin Plummer, Emily Forre, Erica Morrison, and Adrian Hill. Our team includes Haley Jones, Greg Walters, Matt Berg, Joseph Dutra, Johanna Case, and Desmond Taylor. Our music is by Kyle Murdoch and Jordan Cantor. We had helped today from the Associated Press. Our production staff is proudly unionized with the Writers Guild of America East.